The Other Marriage Penalty

By now we are all familiar with the “marriage penalty” in the federal income tax code, if only because getting rid of it is a major part of the President’s tax reduction program.  Most of us know that, the year after two working people get married, they will get a wedding present of a considerably higher tax bill (around $1,500.00 on average) than they paid the year before.  The original premise of this nasty provision was that two can live as cheaply as one-and-a-half.  Which is hard for many of us to accept, especially considering the large number of couples who set up housekeeping together well before (and often instead of) marriage. Whatever economies of scale there may be in sharing a household, people no longer have to be married to achieve them.  So the additional tax penalty is no longer a penalty for living cheaply, it is a penalty for doing the religiously and socially acceptable thing and getting married instead of just living together.  Most of us think it’s wrong to have to pay such a penalty, and will be glad to see it ended.   

But we are less familiar with another marriage penalty built into federal legislation–not in the tax code, but in the Social Security Act and its amendments.  The most egregious and sweeping “marriage penalty” is the one levied against recipients of SSI–Supplemental Security Income. This is the federal program for people who cannot work and have no work history behind them to qualify for Social Security retirement and disability payments.   

SSI currently covers roughly 6.5 million people.  They may be elderly people who have spent their lives working in jobs that did not pay Social Security retirement premiums–farm labor, domestic labor, work for some governmental organizations and charitable or church groups.  They may be young people who have serious disabilities and have never been able to work at all.   But (effective January 1, 2007) the Federal benefit rate is $623 for an individual and $934 for a couple. That is the most income they are allowed to receive.  Every penny they get from every other source gets taken off the SSI grant. 

Got that?  Two people with serious disabilities, who cannot expect ever to be able to support themselves, and who have to accept a life with physical limitations, have to pay $3,500.00 a year, one quarter of their total income, for the privilege of being legally married.  That’s roughly twice as much as most taxpayers pay in the IRS marriage penalty.  And, obviously, it leaves them a lot less to live on than most of those taxpayers have.  Maybe two can live as cheaply as one-and-a-half, at the middle and upper ends of the income scale.  But SSI recipients are squarely at the bottom of that scale.  Just try to imagine living alone on $600 a month.  Now try to imagine living with your spouse on $934 a month.  Try to imagine having to choose between violating the morality you were brought up with, accepting a 25% reduction in an already inadequate income, and spending an already difficult life alone.   

We don’t know, and currently have no way of finding out, how many couples on SSI have been deterred from marriage by the SSI marriage penalty.  We certainly have no way to find out how many of those have accepted unlicensed cohabitation, with or without a religious ceremony, and how many have simply had to spend their lives without the companionship the rest of us take for granted.  So we also have no way of knowing how much it would cost to end the other marriage penalty.   

By the most wildly pessimistic calculation, let us assume that all of the 6.5 million people on SSI are single people, half of them male, half female.  Then let’s assume they all marry each other. That’s 3.25 million couples getting an extra $3500 a year each, or $10.3 billion total.  Compared to the tax cuts Bush is currently trying to sell, well into the trillions, that’s peanuts. While our president and lawmakers are bragging about our surpluses and falling all over each other to give them “back” to the most fortunate of our citizens, surely we can at least spare a thought for the least fortunate and their right to “the pursuit of happiness.”  Let’s end the SSI marriage penalty now.

Jane Grey

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