|Millions of Americans will be
gathering their receipts, tabulating income, and searching for
possible exemptions and deductions this week. Time is
running out for taxpayers to fill out tax forms and get them
into the mail by April 17.
When they see the bottom line, many Americans -- especially
middle-income working spouses with children -- will have smiles
on their faces. But singles without children -- especially
those who are barely above the threshold of poverty -- will have
no cause to rejoice.
A report published by the Urban
Institute in 2004 documented how married and single people are
treated differently in terms of taxation of those near the
poverty line. In 2003 the poverty threshold was $9,573 for
a single person without children and $12,321 for a married
couple without children.
single person with no children begins paying taxes slightly
before his or her income reaches the poverty threshold; a
married couple with no children begins paying taxes slightly
after their income reaches the poverty threshold," the report
In other words,
no married couple living in poverty will pay income tax,
although some single people in poverty will. What's that
John O. Fox, tax attorney and
author of "If Americans Really Understood the Income Tax,"
discussed the little noticed "singles penalty" with the
Washington Post in May 2003.
"Single people had better start
paying attention," Fox told the Post. "The lawmakers'
obsession with eliminating the so-called marriage penalty --
could it be because married people tend to vote more often? --
is unaccompanied by any outrage over the singles' penalty -- the
obligation of millions of single people to pay income taxes on
an appallingly low level of income."
To make his point, Fox gave two
hypothetical examples. One was a low-income single woman
(Jennifer Adams) living alone and the other was a middle-income
married couple (Tom and Grace Chance) with two children.
Under Fox's example, Jennifer was
33 and earned $11,000 cleaning motel rooms. She took the bus to
work because she could not afford parking fees, rented an
efficiency apartment for $400 a month, received no work
benefits, paid all her health insurance premiums and
out-of-pocket health costs, and had no other income. She could
not afford to put anything away for retirement.
Then there's Fox's hypothetical married couple. Tom and Grace
Chance are 31-year-old parents of 1-year-old twin girls. Tom
earned $66,000 as a full-time associate in a national accounting
firm, plus $3,000 his employer contributed to his 401(k) plan,
to which Tom also contributed $6,000 out of his salary. Grace
earned $11,000 as a part-time secretary.
The scenario Fox gave to the Post listed other tax breaks
that the married couple could access which were not available to
the cleaning woman.
Tom's employer had a "cafeteria plan," which offered a large
menu of opportunities for him to avoid taxes on the portion of
his wages his employer uses to pay many of his personal
expenses. Tom's menu -- totaling $16,000 -- covered premiums for
a family health insurance policy and a disability-income policy;
out-of-pocket family medical expenses and parking expenses at
work; and $5,250 (the maximum allowed under the rules) for
college courses he was taking in late 19th-century expressionist
Tom and Grace owned a four-bedroom house. They had mortgage
interest, property taxes and state income taxes to pay. They
also made small charitable contributions. These expenses came to
Fox asked readers of the Post: "Should Jennifer pay an income
tax? Should the Chances? If only one should pay, which one?
The answer, according to IRS rules and Fox's calculations:
Jennifer had to pay; Tom and Grace did not.
This result does not seem fair to me and I suspect that many
other Americans, especially low-income singles, would find it
hard to justify. So what can be done about it?
What John O. Fox told readers of the Washington Post three
years ago seems just as valid today as it was then:
"A worthy first step might be to ask candidates to explain
why a struggling single person like Jennifer Adams should pay an
income tax, while fairly comfortable marrieds-with-children like
the Chances should not. I don't know why. Do you?"
Single taxpayers should remember that all members of Congress
are up for reelection this year. April 18 would be a good
time to write your Senator and Representative to tell them how
you feel about "singles penalties" in the tax codes.
I say "singles penalties" (plural) because it's not just the
Income Tax Code which treats unmarried Americans unfairly by
giving a "marriage bonus" to many couples who file jointly and
by taxing domestic partner health benefits but not spousal
Social security tax is unfair to singles too. If a
single person dies a month before retirement, everything paid
into social security is forfeited. But if a married person
dies, the surviving spouse gets a survivor benefit.
Federal estate tax should not be forgotten. A married
person can leave an unlimited amount of wealth to a surviving
spouse, tax free. But a single person with an estate above
the exemption level can't leave a bequest to a friend, sibling,
or partner without Uncle Sam taking a hefty bite first.
If you're single and feel you are paying more than your fair
share of taxes, mark your calendar for April 18. Call it
singles' tax protest day.
Unmarried America 2006
Thomas F. Coleman, Executive Director of Unmarried America, is an
attorney with 33 years of experience in singles' rights, family
diversity, domestic partner benefits, and marital status discrimination.
Each week he adds a new commentary to Column One: Eye on Unmarried
firstname.lastname@example.org. Unmarried America is a nonprofit
information service for unmarried employees, consumers, taxpayers, and