Hesitating at the Altar

Nick Frazier and Margaret McKeehan

Public Finance Review, 2018, vol. 46, issue 5, 743-763

Abstract: This article provides evidence that the US tax code’s dependence on marital status continues to generate an implicit marriage tax and distort marital decisions. By looking at the timing of marriage rather than the decision to marry, we capture a specific distortion while allowing for heterogeneity in other costs of marriage. Using data on couples from the Panel Study on Income Dynamics between 1986 and 2011, we find that a 1 percent rise in the size of the marriage tax relative to a couple’s income increases the probability of delay by 1.2 percentage points. We further demonstrate the robustness of this result across a variety of alternative specifications and assumptions regarding tax-filing behavior.

Keywords: marriage tax; tax credits; EITC; timing (search for similar items in EconPapers)
Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:sae:pubfin:v:46:y:2018:i:5:p:743-763

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