What is a marital deduction?

A marital deduction is a tax law in Texas that allows widowed or divorced individuals to keep a portion of their income from being taxed. This deduction is more commonly referred to as a “spousal deduction” because it applies exclusively to married individuals. The marital deduction is set up in such a way that if one spouse earns more money than the other, the lower-earning spouse can claim a portion of the higher-earning partner’s income. That portion is typically taken as a percentage of the total income earned by both partners. This allows the lower-earning spouse to maintain a lower overall tax burden and keep more of their hard-earned money in their pocket. The marital deduction is important to consider in divorce matters because it can have a large impact on the final settlement agreement between the parties. Without this deduction, the spouse with the higher income would be liable for a much larger tax burden, which could lead to a greater financial burden for the lower-earning spouse.

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What is a marital deduction?

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