Tax Minimization by French Cohabiting Couples
Language
EN
Article de revue
This item was published in
National Tax Journal. 2022-05p. 000-000
English Abstract
This paper examines the tax returns of French cohabiting couples with children. These couples form two separate tax units and must optimally assign their children to the tax unit of one of the parents to optimize tax ...Read more >
This paper examines the tax returns of French cohabiting couples with children. These couples form two separate tax units and must optimally assign their children to the tax unit of one of the parents to optimize tax rebates. We find that children are allocated in a way that minimizes tax liability in 75 percent of cohabiting households. The 25 percent of households that fail to minimize their liability appear to use heuristics, are influenced by inertia, and possibly fail to fully cooperate as suboptimal couples tend to separate more and marry less in the subsequent period.Read less <
English Keywords
efficiency
noncooperative model
income taxation
learning
tax returns