The Congressional Budget Office estimates that in 1996, approximately 21 million married couples paid an average of $1,400 extra to the IRS because joint filing pushed them into higher tax brackets. This consequence of our massive tax code is known as the "marriage penalty," and there are two Congressmen working for its elimination.

Representatives Jerry Weller (R-IL) and David McIntosh (R-IN) introduced legislation last week to eliminate the marriage tax penalty with the support of over 200 members, including House Speaker Newt Gingrich and some Democrats. The Marriage Tax Elimination Act (H.R. 2456) would wipe out the marriage penalty by allowing couples to choose what filing status makes the most sense for them – single or joint.

The current system punishes people simply for being married. Consider the following example: If a husband and wife both earn $30,500, for a total household income of $61,000, their taxable income after standard exemptions and deductions would be $49,200. At this income level, the couple is taxed at the 28 percent marginal rate – for a total tax bill of $8,563. Now if this same couple divorced or simply lived together without getting married, their earnings would be taxed separately. Their separate taxable income would be $23,950 each, placing them safely in the 15 percent tax bracket individually. In other words, the marriage certificate that sets the first couple apart comes with a $1,378 annual price tag.

The marriage penalty began as an effort to correct a "singles penalty" after World War II. Married couples gamed the progressive tax system by dividing the income of the household into two and filing in a lower bracket. Unmarried taxpayers, who could not divide their earnings and slide down to another tax bracket, cried foul and the marriage penalty – the requirement that couples pay taxes based on their total household income – was born.

Trouble is, things are different today. The drafters of the requirement never imagined that dual income households would become the norm, not the exception. Under the existing law, a second income faces a steep liability when added onto the primary income. Since women still make up the preponderance of secondary earners in married households, these quirks and kinks of the system hit working women hardest. They force married women into a comparative disadvantage, since their tax considerations necessarily affect their professional choices.

Trying to encourage good behavior through the tax code is always an endeavor worthy of suspicion. Even with the best intentions, the unintended consequences tend to outweigh any general good such policies might produce. The existing marriage penalty, though, actively punishes what most of us would consider "good behavior." Eliminating the marriage penalty, then, is not about encouraging good behavior but about neutralizing the current system's punitive effects. As Senator Huchison (R-TX) said at the press conference to announce the bill, "Americans should not have to choose between love and money."

The Marriage Tax Elimination Act might be a small step after what the recent hearings have revealed about the IRS, but it is an important step – both to correct the inequities outlined above and to restore taxpayer rights. By taking away the forced march into a higher tax bracket, a de facto flatter system will develop since most people will choose to file in the category that gives them the lowest rate. This effort could help lead to a simpler, non-discriminatory system and that would be good for all Americans.

—Katherine Post

Director of the Center for Enterprise and Opportunity