How This Calculator Figures the Marriage Penalty
The tool builds three simplified federal returns from the same numbers: one for each partner as an unmarried filer and one married filing jointly return. The penalty or bonus is the joint total minus the two unmarried totals. For the rules behind it, see the Marriage Penalty Guide.
Step 1: Income on Each Return Form 1040
Each unmarried return uses that partner's wages plus other ordinary income. The joint return adds both partners' income together. The tool treats this total as adjusted gross income and taxable income before deductions, so enter amounts after any adjustments to income you already know about, such as retirement plan deferrals that are already out of box 1 wages.
Step 2: The SALT Limit on Each Return IRC 164(b)(7)
State and local taxes are deductible up to the "applicable limitation amount": $40,000 for 2025 and $40,400 for 2026. The statute uses the same amount for a single return and a joint return; only married filing separately gets half. The limit is reduced by 30% of modified adjusted gross income over $500,000 (2025) or $505,000 (2026), but never below $10,000. The tool applies this test to each unmarried partner's own income and to the couple's combined income.
Step 3: Standard or Itemized Deduction IRC 63(c)
Each return takes the larger of its standard deduction or its itemized deductions (the allowed state and local taxes plus the other itemized deductions you enter). Standard deductions: 2025 $15,750 single, $23,625 head of household, $31,500 joint (OBBBA section 70102); 2026 $16,100, $24,150 and $32,200 (Rev. Proc. 2025-32 section 4.14). On the joint return both partners' itemized deductions are combined, so a couple can only itemize if the total beats $32,200 for 2026. A partner who is age 65 or older or blind adds an additional standard deduction for each condition under IRC 63(f): $2,000 on an unmarried return and $1,600 for a married filer for 2025 (Rev. Proc. 2024-40 section 2.15(3)), and $2,050 and $1,650 for 2026 (Rev. Proc. 2025-32 section 4.14(3)). Because the married amount is lower, marriage itself shrinks this part of the deduction by $400 per condition. Itemizers do not get it. For 2026 only, IRC 68 as amended by OBBBA section 70111 then reduces the itemized deductions on any return whose income is above the start of its 37% bracket, even if the reduced taxable income stays below it, by 2/37 of the smaller of those deductions or the amount by which income (taxable income before the reduction plus the itemized deductions) exceeds the start of the 37% bracket ($640,600 single and head of household, $768,700 joint); the limit did not apply for 2025.
Each partner who is age 65 or older also gets the enhanced deduction for seniors under IRC 151(d)(5)(C), added by OBBBA section 70103 for 2025 through 2028: $6,000 per person, each reduced by 6% of modified AGI over $75,000 on an unmarried return or $150,000 on a joint return (Schedule 1-A Part V). It is a Schedule 1-A deduction taken after AGI (Form 1040 line 13b), so it reduces taxable income but not AGI, and it is available whether the return itemizes or takes the standard deduction. A married couple must file jointly to claim it, and each person needs a valid Social Security number. The tool treats AGI as modified AGI, which is correct unless you exclude foreign or U.S. territory income.
Step 4: Income Tax From the Rate Schedules IRC 1(j)
Taxable income is income minus the deduction, not less than zero. Each return is taxed with the rate schedule for its filing status: Table 3 (unmarried individuals), Table 2 (heads of households) and Table 1 (married filing jointly) of Rev. Proc. 2024-40 for 2025 and Rev. Proc. 2025-32 for 2026. The tool uses the schedules to the cent; the IRS Tax Table used for taxable income under $100,000 rounds to $50 bands, so a filed return can differ by a few dollars.
Step 5: Additional Medicare Tax IRC 3101(b)(2)
The 0.9% Additional Medicare Tax applies to wages over $200,000 for an unmarried filer and over $250,000 of combined wages on a joint return. These thresholds are fixed in the statute and are not indexed for inflation. The tool adds it to each return's total, because it is reported on Form 8959 and paid with your income tax.