Explaining the Fall and Rise in the Tax Cost of Marriage : The Effect of Tax Laws and Demographic Trends, 1984-97

This paper documents changes in the tax consequence of marriage over the period 1984 to 1997. Reversing the impact of the 1986 Tax Reform Act, tax acts in 1990 and 1993 are found to increasingly tax marriage. Our decomposition of different components show that, altogether, tax laws explain most (55-60 percent) of the change in the tax cost of marriage between 1984 and 1997. Our decompositions also show that the non-tax changes are almost exclusively driven by the changing labor market attachment of married women (as measured by their share of family earnings) and not by family size or total family income