Linda and Raj are engaged to be married. Linda's 2012 taxable income as a single individual would be $83,500. Raj's 2012 taxable income as a single individual would be $118,000. When they marry before the end of 2012, how much of a marriage penalty will they incur?

Question

Quizplus · Accepted Answer

When they get married, they will have a combined taxable income of $201,500. If they file as a married couple, they will be in the 33% tax bracket with a tax liability of $54,793. If they were to remain single, their combined tax liabilities would be $37,000 + $25,260 = $62,260. The difference in tax liability is $54,793 - $62,260 = $7,467, which is the marriage penalty. Dividing this by 2 gives $3,733.50, which is the amount of marriage penalty each will incur. Therefore, the correct answer is C.

Linda and Raj Are Engaged to Be Married