If the marginal deduction rate exceeds 100%, then an increase in gross income leads to a decrease in disposable income, discouraging attempts to increase income; when this occurs for low income individuals, it is known as the "poverty trap".
Then an increase in gross income leads to a decrease in disposable income. Then an increase in gross income was discouraging attempts. This was to increase income; when this occurs for low income individuals, it is known as the "poverty trap". The marginal deduction rate exceeds 100%.