Quote:
Originally Posted by Truenorth00
We're a couple with a touch of over $150k with me making six figures. We could save like $5k if we were allowed to simply average out. This would be a lot more useful to me than $10/d daycare which we have never succeeded in accessing and increasingly seems like some unicorn that only connected parents find, especially when it comes to school age pre/after school care.
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We've had a big "K-shaped" recovery these last few years where some people's incomes have kept pace with (or even outpaced) inflation while others have not. This sort of thing will only get more pronounced in the coming years as the economic changes (the "fourth industrial revolution" as some call it) make some fields of work more lucrative while other fields of work literally disappear with automation. It's not unreasonable to expect that spousal income gaps are going to grow, not shrink, as a result of this trend. Historically, these gaps shrank considerably as the male-female opportunity gap closed and pay-equity for women improved. Income splitting, or any other tax scheme that could be seen as benefitting couples with bigger income gaps, was historically seen negatively by a lot of feminists for this reason.
But in this new age, this doesn't seem relevant anymore. It's becoming almost as common for the woman to be the higher earner in heterosexual marriages.
With the coming automation of a lot of jobs, and the disproportionate concentration of opportunity in specific sectors, a modest revival of single-income households might honestly be a good thing. In this day and age, you'd have plenty of stay-at-home dads with breadwinner moms instead of just the opposite happening all the time, so the gender equity issue is not there anymore.
All this long-winded text to basically say: income splitting should be revisited. Maybe with some sort of cap to prevent the really extreme scenarios of someone with $500k a year splitting income completely with a stay-at-home spouse to save five figures on income tax. (Could be implemented by having a maximum of $100k per year that can be "reassigned" from one spouse to another).