Marriage Tax Penalty One Step Closer to its Grave?

With a vote of 269-159, the House gave its blessing to a marriage tax relief bill that is now on its way to the Senate. The Senate hopes to send a final version of the marriage bill, along with a bill for demolishing the estate tax, to President Clinton on the eve of the Republican National Convention, the timing of which is not coincidental.

The marriage penalty tax, as it is justifiably called, is a nuance of the tax code that requires married couples to pay tax at a higher rate than they would if they remained single. The tax law especially affects married couples negatively when both work. The change that Congress is considering would phase out the tax penalty to married couples over a 10-year period.

Senate Republicans hope to use Clinton’s response to both bills as ammunition at the convention. If Clinton vetoes the bills, as he has threatened to do because they will not contain provisions for his pet project of a government-run Medicare prescription drug benefit, Republicans will use his refusal to sign as a means of setting their party out as the party that wants to cut taxes. If Clinton surprises Republicans and signs either of the bills, the party plans to challenge Vice President Gore’s claim that Republicans are running a “do nothing” Congress.

It would seem that these bills, though close to the hearts of all Americans, are little more than political ploys at this time.

You may like these other stories...

School tax breaks get House support as Democrats objectRichard Rubin of Bloomberg reported that the House of Representatives on Thursday voted to expand and simplify tax breaks for education as Republicans continue to pass...
Many senior US tax professionals believe that a streamlined audit process will be the top benefit resulting from the IRS Transfer Pricing Audit Roadmap, a new toolkit organized around a notional 24-month audit timeline,...
Tax accounting to be simplified for money-market fundsThe US Securities and Exchange Commission (SEC) voted 3-2 on Wednesday for sweeping changes to institutional money-market funds, Emily Chasan, senior editor of...

Upcoming CPE Webinars

Jul 31
In this session Excel expert David Ringstrom helps beginners get up to speed in Microsoft Excel. However, even experienced Excel users will learn some new tricks, particularly when David discusses under-utilized aspects of Excel.
Aug 5
This webcast will focus on accounting and disclosure policies for various types of consolidations and business combinations.
Aug 20
In this session we'll review best practices for how to generate interest in your firm’s services.
Aug 21
Meet budgets and client expectations using project management skills geared toward the unique challenges faced by CPAs. Kristen Rampe will share how knowing the keys to structuring and executing a successful project can make the difference between success and repeated failures.