What is the marriage penalty vs. marriage bonus, and does it affect my 2025 tax return?

The marriage penalty occurs when two spouses filing jointly pay more combined tax than they would have paid as two single filers. The marriage bonus is the opposite — the couple pays less combined tax by filing jointly than they would have as singles. Whether you face a penalty or a bonus depends almost entirely on how similar your incomes are.

When you get a marriage BONUS (filing jointly saves money):

• One spouse earns significantly more than the other — or one doesn't work at all
• The lower-earning spouse's income fits inside the higher-earning spouse's "remaining" lower tax brackets
• Example: Spouse A earns $150,000, Spouse B earns $20,000. As singles, Spouse A pays more tax. Filing jointly combines incomes and often shifts more of Spouse A's income into lower brackets

When you face a marriage PENALTY (filing jointly costs more):

• Both spouses earn roughly similar, high incomes
• Their combined income pushes the household into a higher bracket that a single filer with the same income wouldn't hit
• This especially impacts couples where both spouses earn over $200,000 individually

Good news from TCJA and OBBBA: The 2017 tax reform largely eliminated the traditional marriage penalty for most brackets by making the MFJ brackets exactly double the single brackets up to the 32% bracket. However, the 35% and 37% brackets do NOT double — so high-dual-income couples still face a penalty there.

2025 bracket thresholds:

• 37% kicks in at $626,350 (single) vs $751,600 (MFJ) — not doubled, creating a penalty zone
• 35% starts at $250,525 (single) vs $501,050 (MFJ) — this one IS doubled, no penalty

Other marriage-related tax considerations:

• Married Filing Separately (MFS) almost always costs more in taxes and disqualifies you from many credits (EITC, child and dependent care credit, student loan interest deduction)
• SALT cap: The new $40,000 SALT cap applies per return — MFS filers are capped at $20,000 each
• When MFS makes sense: Large unreimbursed medical expenses (2% AGI threshold), income-driven student loan repayment calculations, or legal separation situations

For most couples, filing jointly is better — but if you're both high earners with similar incomes, modeling both scenarios in tax software is worth doing before you file.