Question

Alex and Alecia used the married filing jointly filing status when they prepared their tax return. During the current year, their joint tax liability totaled $9,300. If they were not married and had both filed as single, Alex would have had a $3,900 tax liability, and Alecia would have had a $5,000 tax liability. What is the term used for the $400 difference in their tax liability?

Answer 1

The term used for the $400 difference in their tax liability is

Marriage Penalty

Step-by-step explanation:

Marriage Penalty:

It is such type of tax that has to pay by the married couples in the United States of America. Thus their combined tax increases but sometimes the married couples also get marriage bonus as well.

• In our case, Alex and Alecia have to pay $3900 and $5000 tax as single and if sum their taxes then it becomes $89,00. But as married couple, they have to pay a tax of $9,400 and that extra $400 is marriage penalty.