for 2017 and earlier, the domestic production activities deduction and the tuition and fees deduction paid before 2021. excluded employer adoption benefits, and,. foreign earned income and housing exclusions,. Traditional IRA Deductibility: MAGI is calculated by adding AGI plus the following:. You can generally determine what goes into it by looking at the form instructions. Let’s look at several common tax benefits and the modified adjusted gross income calculation for each of them. Want to know how to calculate Modified Adjusted Gross Income? We’ll cover that here. How to calculate Modified Adjusted Gross Income When determining MAGI for a particular tax benefit, you should know the definition of MAGI for purposes of that particular benefit. However, there are some common threads.įor instance, most calculations add excluded foreign earned income back, but not all add back excludable savings bond interest and excludable adoption benefits. So, what is MAGI and the formula to calculate it? Which amounts need to be added to your AGI? Well, it depends - there are different definitions of MAGI for different tax benefits. Adjusted Gross Income (AGI)– This is your Gross Income with certain allowable deductions subtracted but does not include the standard or itemized deductions or any exemptions. Gross Income – This is the money you earn from all sources, including wages, tips, investment income, pension or rents. Modified Adjusted Gross Income – Breaking it downįiguring out your Modified AGI starts with your Gross Income and then your AGI. Learn more about MAGI and where to go for help determining it here. “What is Modified Adjusted Gross Income,” you wonder? Modified Adjusted Gross Income (or MAGI for short) is an important tax term to understand for a number of reasons. 
MAGI can vary depending on the tax benefit. The IRS uses your MAGI to determine your eligibility for certain deductions, credits and retirement plans.
Modified Adjusted Gross Income (MAGI) in the simplest terms is your Adjusted Gross Income (AGI) plus a few items - like exempt or excluded income and certain deductions.
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