'Marriage penalty' in Washington state's new millionaire tax stirs debate
Washington state introduces a controversial millionaire tax.
Washington state has enacted its first income tax, imposing a 9.9% rate on individuals and couples earning over $1 million annually. This legislation has sparked debate over a significant marriage penalty, as couples with combined incomes exceeding the threshold will be taxed, even if each partner earns less than $1 million individually. Critics argue that this could disproportionately affect dual-income families in a state known for its high salaries, prompting discussions about potential tax strategies, including legal separations to avoid the penalty.
Key Takeaways
- 1.
The new tax imposes a 9.9% rate on incomes over $1 million.
- 2.
Married couples earning $1.2 million will face the tax, despite individual incomes below the threshold.
- 3.
Washington's marriage penalty is the largest in the nation, potentially costing couples $99,000.
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