Ed and Wendy are a married couple with no children. Each earns $75,000 per year, and their combined household adjusted gross income is $150,000. John and Kristen also have $150,000 in combined household adjusted gross income and no children. However, Kristen earns all the income and John does not work. Finally, the standard deduction for married couples filing jointly is $24,000 and the standard deduction for a single taxpayer is $12,000. (Hint: To answer this question, you will need to use the 2018 Tax Rate Schedules attached at the end of this document. Notice how this is a different version of figure 3 from class slides #14).

a. Use the 2018 tax rates for married couples filing jointly to compute how much income tax each couple owes. Assume that both take the standard deduction.

b. Does either couple pay a marriage tax? Does either couple receive a marriage benefit?

2018 Tax Rate Schedules
Schedule Y-1 - If your filing status is Married filing jointly or Qualifying wodow(er)
If your taxable		The tax is:
income is:
Over	but not over		of the amout over
$0	19,500	10%	$0
19,050	77,400	$1,905.00 + 12%	19,050
77,400	165,000	8,907.00 + 22%	77,400
165,000	315,000	28,179.00 + 24%	165,000
315,000	400,000	64,179.00 + 32%	315,000
400,000	600,000	91,379.00 + 35%	400,000
600,000		161,379.00 + 37%	600,000