A "Marriage-Strengthening Tax Deduction"?

| | Bookmark and Share
Louisiana lawmakers face the pleasant prospect of a big budget surplus-- at least in the short run. As a result, this year's legislative session has been primarily about how (and how much) to cut taxes. There's been a parade of clever, and not-so-clever, ideas.

Yesterday's session of the state House tax writing committee was no different. Representative Gary Beard (R-Baton Rouge) proposed what he calls a "marriage-strengthening tax deduction" bill, HB 279. The bill gives a tax deduction of $100 for each year of marriage starting with the fifth year, with a cap of $2,000 on the deduction for each return.

The implications are fascinating.
  • The first five years of marriage apparently are trouble-free enough that no tax incentives are needed to keep the marriage together.
  • But at the five-year mark, marriages start going to hell pretty fast. The longer you stay married past this point, the bigger your tax deduction.
  • And it's only on their silver anniversaries that Louisianans find themselves able to keep their marriages together without a little extra encouragement from the tax system each year.
  • Since the marriage tax break is designed as a credit rather than a deduction, the sponsor clearly thinks that rich people need more incentive to stay married than do poorer families.
  • Since the tax break is a nonrefundable deduction, the clear implication is that families too poor to pay state income taxes have more stable marriages than do wealthier families.

Ways and Means Committee members had few questions before they politely put the bill on the "bone pile" of tax proposals that may (or may not) someday be voted on in committee.

But Rep. Rick Farrar had a good one, asking whether there would be a "clawback" provision: in other words, if you get divorced, do you have to give the money back?

At a time when Louisiana lawmakers are discussing some big-ticket tax cuts, the Farrar bill is small potatoes-- hardly worth discussing except to laugh at it. But it's actually a pretty good allegory for the economic development tax incentives state lawmakers offer every day. Earlier this month, Alabama lawmakers gave the ThyssenKrupp corporation $800 million in immediate tax incentives-- and the promise of a thirty-year exemption from state corporate income taxes--to encourage them to build a steel mill in Alabama. Did the incentives change ThyssenKrupp's mind-- or just reward them for what they were going to do anyway? No one really knows except ThyssenKrupp. Similarly, no one know if a $100 tax deduction is going to be enough to keep a bad marriage going for one more year. The most likely outcome is that a bunch of happy couples will get a tax break for doing something they were going to do anyway-- stay married.

Thank you for visiting Tax Justice Blog. CTJ and ITEP staff will soon retire this domain. But ITEP staff are still blogging! You can find the same level of insight and analysis and select Tax Justice Blog archives at our new blog, http://www.justtaxesblog.org/

Sign Up for Email Digest

CTJ Social Media

ITEP Social Media