Want your numbers? Compute your AGI and all seven MAGI figures in one step, with the right add-backs applied and your threshold position shown.
Open the AGI and MAGI Calculator →Modified Adjusted Gross Income (MAGI) is your Adjusted Gross Income (AGI) with certain items added back - and there is no single MAGI. AGI is total income (Form 1040 line 9) minus the above-the-line adjustments in IRC §62 (line 11). Each benefit that uses MAGI defines its own add-backs: the IRA and Roth MAGI add back the IRA deduction, student loan interest, foreign exclusions, savings bond interest, and adoption benefits (Roth also subtracts conversion income); the Premium Tax Credit MAGI adds tax-exempt interest, foreign income, and non-taxable Social Security; education credits and student loan interest add foreign and Puerto Rico/American Samoa income; NIIT adds net foreign income; Medicare IRMAA adds tax-exempt interest and uses your MAGI from two years prior. For a filer with none of these items, MAGI equals AGI. The new OBBBA tips, overtime, car loan, and senior deductions are below-the-line and do not reduce AGI or MAGI.
- AGI = total income minus above-the-line adjustments (IRC §62, Schedule 1 Part II). It is Form 1040 line 11.
- MAGI is not one number - it is a family of figures, each defined by the benefit that uses it.
- IRA / Roth MAGI adds back the IRA deduction + student loan interest + foreign exclusion + §135 savings bonds + §137 adoption. Roth subtracts conversion income.
- Premium Tax Credit MAGI (§36B) = AGI + tax-exempt interest + foreign income + non-taxable Social Security.
- Education (§25A) and student loan (§221) MAGI = AGI + foreign income + Puerto Rico/American Samoa income.
- NIIT (§1411) = AGI + net foreign income; thresholds $200K single / $250K MFJ / $125K MFS.
- IRMAA = AGI + tax-exempt interest, using your MAGI from two years prior.
- The standard deduction, itemized deductions, and the §199A QBI deduction are below the line and do not reduce AGI.
- OBBBA Schedule 1-A deductions (tips, overtime, car loan, senior $6,000) flow to Form 1040 line 13b - they do not reduce AGI or MAGI.
- To lower MAGI, reduce AGI with levers that are not added back: pre-tax 401(k), HSA, deductible IRA, self-employed retirement.
What Is Modified Adjusted Gross Income
Modified Adjusted Gross Income (MAGI) is a figure used throughout the Internal Revenue Code to phase out tax benefits as income rises. It starts with your Adjusted Gross Income (AGI) and adds back specific items that AGI excludes. The critical fact most taxpayers miss is that there is no single MAGI. Congress wrote a different MAGI definition for each benefit, at different times and for different policy reasons, so the "MAGI" for your IRA deduction is not the same calculation as the "MAGI" for your Premium Tax Credit or your Medicare premium.
The reason MAGI exists at all is that AGI is computed before certain exclusions and deductions are added back. A taxpayer who excludes $80,000 of foreign earned income, or earns $20,000 of tax-exempt municipal bond interest, has a low AGI but substantial economic income. Means-tested benefits use MAGI to capture that economic income, so the same person does not appear artificially poor for purposes of a subsidy or contribution limit.
For a large share of taxpayers - those with only wage, interest, dividend, and capital gain income, no foreign exclusions, no tax-exempt interest, and no IRA or student loan deduction - MAGI equals AGI for every purpose. The complexity only matters when you have one of the items that a particular MAGI adds back. This guide walks through each of the seven most common MAGI definitions and exactly what each one adds.
How AGI Is Computed (and What It Excludes)
AGI is defined in IRC §62 as gross income minus a specific list of deductions, known as "above-the-line" adjustments because they are subtracted to arrive at AGI (the "line"). On the 2025 and 2026 Form 1040, total income is line 9, total adjustments to income are line 10 (from Schedule 1 Part II), and AGI is line 11.
Above-the-Line Adjustments (Reduce AGI)
Per IRC §62(a) and Schedule 1 Part II, the adjustments that reduce AGI include:
- Educator expenses up to $300 (§62(a)(2)(D))
- Certain business expenses of reservists, performing artists, and fee-basis government officials
- HSA deduction (§223)
- Deductible part of self-employment tax - one-half of SE tax (§164(f))
- Self-employed SEP, SIMPLE, and qualified plan contributions (§404)
- Self-employed health insurance deduction (§162(l))
- Penalty on early withdrawal of savings
- Traditional IRA deduction (§219)
- Student loan interest deduction up to $2,500 (§221)
- Alimony paid under pre-2019 divorce decrees
What Comes After AGI (Does NOT Reduce AGI)
The standard deduction and itemized deductions are subtracted from AGI to reach taxable income - they are below the line. The §199A qualified business income (QBI) deduction is also below the line (Form 1040 line 13). And as of 2025, the four new OBBBA deductions on Schedule 1-A are below the line too. None of these reduce AGI, so none of them change any MAGI. This distinction matters because AGI - not taxable income - drives nearly every income threshold in the Code.
IRA and Roth IRA MAGI
The traditional IRA deduction and Roth IRA contribution limits use MAGI definitions set out in IRS Publication 590-A. They share most add-backs but differ in one respect.
Traditional IRA Deduction MAGI (Worksheet 1-1)
Per Pub 590-A Worksheet 1-1, the traditional IRA deduction MAGI is AGI plus: the traditional IRA deduction itself, the student loan interest deduction, the foreign earned income exclusion, the foreign housing exclusion or deduction, excludable U.S. savings bond interest (§135, Form 8815), and excludable employer-provided adoption benefits (§137, Form 8839). The IRA deduction is added back to avoid a circular calculation. If you are covered by a workplace retirement plan, the deduction phases out over the ranges below; if you are not covered (and not married to someone who is), there is no income limit on deductibility.
Roth IRA MAGI (Worksheet 2-1)
Per Pub 590-A Worksheet 2-1, the Roth IRA MAGI uses the same add-backs as Worksheet 1-1, then subtracts any income you reported from converting a traditional IRA to a Roth IRA or rolling over to a Roth IRA. This subtraction is important for planning: a Roth conversion raises your AGI but is removed from your Roth MAGI, so a conversion does not block your ability to make a regular Roth contribution.
| Limit | Single / HOH | MFJ / QSS | MFS |
|---|---|---|---|
| Traditional IRA deduction (covered), 2026 | $81,000 - $91,000 | $129,000 - $149,000 | $0 - $10,000 |
| Traditional IRA deduction (covered), 2025 | $79,000 - $89,000 | $126,000 - $146,000 | $0 - $10,000 |
| Roth IRA contribution, 2026 | $153,000 - $168,000 | $242,000 - $252,000 | $0 - $10,000 |
| Roth IRA contribution, 2025 | $150,000 - $165,000 | $236,000 - $246,000 | $0 - $10,000 |
A contributor not covered by a plan but married to a covered spouse uses a separate MFJ range of $242,000-$252,000 for 2026 ($236,000-$246,000 for 2025). The 2026 IRA contribution limit is $7,500 with a $1,100 catch-up at age 50+ (the 2025 limit was $7,000 plus $1,000). See the Roth IRA Contribution Calculator and Roth IRA Limits Guide.
Education Credit and Student Loan Interest MAGI
The education credits and the student loan interest deduction use nearly identical MAGI definitions, both narrower than the PTC MAGI.
Education Credit MAGI (§25A)
For the American Opportunity Tax Credit and the Lifetime Learning Credit, MAGI is AGI plus the foreign earned income exclusion, the foreign housing exclusion or deduction, and income excluded from Puerto Rico (§933) or American Samoa (§931). The phase-out is frozen by the Further Consolidated Appropriations Act of 2020 §104 and is not adjusted for inflation: $80,000 to $90,000 for single, head of household, or qualifying surviving spouse, and $160,000 to $180,000 for married filing jointly. The same range applies to both credits and to both 2025 and 2026. Married filing separately cannot claim either credit. See the Education Tax Credit Calculator and the AOTC vs LLC Guide.
Student Loan Interest MAGI (§221)
For the student loan interest deduction, MAGI under §221(b)(2)(D) is AGI computed without the student loan interest deduction itself, plus the foreign earned income exclusion, foreign housing exclusion or deduction, and Puerto Rico or American Samoa excluded income. For 2026 the phase-out is $85,000 to $100,000 (single/HOH/QSS) or $175,000 to $205,000 (MFJ) per Rev. Proc. 2025-32 §4.29; for 2025 the MFJ range was $170,000 to $200,000. MFS is barred under §221(e)(2). Because the §221 MAGI adds the deduction back, claiming the student loan interest deduction does not lower the MAGI used to phase it out. See the Student Loan Interest Calculator and the Student Loan Interest Deduction Guide.
NIIT and Medicare IRMAA MAGI
Net Investment Income Tax MAGI (§1411)
The 3.8% Net Investment Income Tax applies to the lesser of your net investment income or the amount by which your MAGI exceeds a fixed threshold. The NIIT MAGI is AGI plus the net foreign earned income exclusion, so for taxpayers with no foreign earned income, NIIT MAGI equals AGI. The thresholds are statutory and have not changed since the tax took effect in 2013: $200,000 for single or head of household, $250,000 for married filing jointly or qualifying surviving spouse, and $125,000 for married filing separately. Because the thresholds are not indexed for inflation, more taxpayers cross them each year. NIIT is computed on Form 8960.
Medicare IRMAA MAGI
The Medicare Income-Related Monthly Adjustment Amount (IRMAA) determines whether you pay a surcharge on top of the standard Medicare Part B and Part D premiums. The IRMAA MAGI is AGI plus tax-exempt interest. The defining feature is the two-year lookback: your 2026 premiums are based on your 2024 MAGI, and your 2027 premiums on your 2025 MAGI. The Social Security Administration compares your prior-year MAGI to the CMS bracket table for the premium year; crossing a tier adds a fixed dollar surcharge to both Part B and Part D.
The two-year lookback makes one-time income events dangerous for near-retirees: a Roth conversion, a large capital gain, or a home sale that exceeds the §121 exclusion can push you into an IRMAA tier two years later. If your income dropped because of a life-changing event (work stoppage, retirement, divorce, or the death of a spouse), you can ask SSA to use more recent income by filing Form SSA-44.
What Does NOT Reduce AGI (Common Misconceptions)
Several large deductions feel like they should lower AGI but do not, because they are subtracted after the AGI line to reach taxable income.
- Standard deduction and itemized deductions. Both are subtracted from AGI (Form 1040 line 12) to reach taxable income. Neither reduces AGI or any MAGI.
- §199A QBI deduction. The 20% qualified business income deduction sits on Form 1040 line 13, below the AGI line. It reduces taxable income but not AGI.
- OBBBA Schedule 1-A deductions. The four One Big Beautiful Bill Act deductions - no tax on tips (§224), no tax on overtime (§225), car loan interest (§163(h)(4)), and the $6,000 senior deduction (§70103) - are reported on the new Schedule 1-A and flow to Form 1040 line 13b. Per IRS guidance and the Current Federal Tax Developments technical review of the draft form, these "Additional Deductions" are below-the-line: they are not used in computing AGI. They reduce taxable income but never AGI, so they never change a MAGI figure.
The confusion around the OBBBA deductions stems from the fact that you can claim them whether you itemize or take the standard deduction. But being available without itemizing does not make a deduction above-the-line. Above-the-line deductions are the specific items in IRC §62 reported on Schedule 1 Part II - and the Schedule 1-A deductions are not among them. This matters in practice: a tipped worker who assumes their tips deduction lowers their AGI may badly misjudge their Premium Tax Credit, IRA deductibility, or any other AGI-driven benefit.
Stop estimating by hand. Enter your income, adjustments, and any add-backs to see your AGI and all seven MAGI figures with threshold positions.
Open the AGI and MAGI Calculator →How to Lower Your MAGI
Because most MAGI figures start from AGI, the levers that reduce AGI also reduce MAGI. The catch is that two of the largest AGI-reducing items - the traditional IRA deduction and the student loan interest deduction - are added back for the IRA and Roth MAGI, so they do not help you qualify for those two limits. They DO help the Premium Tax Credit, education credit, NIIT, and IRMAA MAGI.
AGI-Reducing Levers That Are Not Added Back
- Pre-tax traditional 401(k) or 403(b) deferral. The 2026 employee deferral limit is $24,500, plus an $8,000 catch-up at age 50+ and a higher catch-up at ages 60-63. Pre-tax deferrals reduce W-2 Box 1 wages and AGI dollar-for-dollar, and they are not added back for any MAGI. See the 401(k) Contribution Calculator.
- HSA contribution. Above-the-line on Schedule 1 line 13. The 2026 limits are $4,400 self-only and $8,750 family, plus a $1,000 catch-up at age 55+. HSA contributions reduce AGI and are not added back for any MAGI. See the HSA Contribution Calculator.
- Self-employed retirement plans. SEP-IRA and Solo 401(k) employer contributions are above-the-line and reduce AGI without being added back. See the SEP-IRA / Solo 401(k) Calculator.
- Capital loss harvesting. Realized capital losses offset capital gains and up to $3,000 of ordinary income, reducing AGI.
Levers That Reduce AGI but Are Added Back for IRA/Roth
The traditional IRA deduction and student loan interest deduction lower AGI but are added back for the IRA and Roth MAGI. Use them to manage your Premium Tax Credit, education credit, NIIT, or IRMAA MAGI - not your IRA or Roth contribution eligibility. For Roth eligibility specifically, a Roth conversion in a prior year is removed from the current Roth MAGI, but the conversion itself raises AGI in its year.
Practitioner Insight (LMN Tax Inc.)
The most common MAGI mistake we see is treating AGI and MAGI as interchangeable. They are equal for a large share of W-2 filers, which lulls people into assuming they always match. The moment a client has tax-exempt municipal bond interest, a foreign earned income exclusion, or non-taxable Social Security, the MAGI for at least one benefit jumps above AGI - and the client who was comfortably under a threshold on AGI is suddenly over it on MAGI. We always recompute the specific MAGI for the specific benefit at issue and never assume AGI is a safe proxy.
The second pattern is the IRA and Roth add-back trap. Clients near the Roth phase-out often ask whether maxing their traditional IRA deduction or claiming student loan interest will pull their MAGI under the Roth limit. It will not, because Pub 590-A Worksheet 2-1 adds both items back. The levers that actually reduce Roth MAGI are the ones that reduce AGI without being added back: a bigger pre-tax 401(k) deferral, an HSA contribution, or a larger SEP or Solo 401(k) contribution for the self-employed.
The third pattern is the Roth conversion versus IRMAA timing conflict. A Roth conversion raises AGI and the IRMAA MAGI in the conversion year, but because IRMAA uses MAGI from two years prior, the Medicare premium hit lands two years later. We map this out for clients age 63 and up before any large conversion, because a conversion at 63 raises premiums at 65 when they first enroll in Medicare. The Roth MAGI itself subtracts conversion income, so the conversion does not block future Roth contributions, but the IRMAA surcharge two years out is a real and often-missed cost.
The fourth pattern is the expat AGI illusion. A client with $80,000 of foreign earned income excluded shows a tiny AGI, but every MAGI adds the exclusion back. For the education credit and student loan interest MAGI, that add-back routinely pushes an otherwise-eligible expat completely out of the benefit. We flag the foreign exclusion as a MAGI add-back on every expat return so the client is not surprised when a credit disappears.
The fifth pattern is the OBBBA Schedule 1-A misconception. Since 2025, clients with tips or overtime income assume those new deductions lower their AGI and therefore help them qualify for AGI-driven benefits. They do not. The Schedule 1-A deductions sit on Form 1040 line 13b, below the AGI line, so they reduce taxable income but never AGI or MAGI. We correct this at intake because a client who plans around a lower AGI from tips can badly misjudge their Premium Tax Credit or IRA deductibility.
Real-World Scenarios
When MAGI Rules Get Complicated
- Household MAGI for the Premium Tax Credit. The §36B PTC MAGI sums the MAGI of the taxpayer, spouse, and every dependent required to file. A dependent child with a summer job that triggers a filing requirement can raise the household PTC MAGI.
- IRMAA two-year lookback. Your premium for a given year depends on income from two years earlier, so planning requires looking backward, not at current income.
- NIIT is not only a MAGI test. The 3.8% tax applies to the lesser of net investment income or the MAGI excess over the threshold - so crossing the MAGI threshold does not by itself determine the tax.
- IRA "not covered" rules. If neither spouse is covered by a workplace plan, the traditional IRA deduction has no income limit. If only the spouse is covered, a separate higher MFJ range applies.
- Social Security taxability is a different calculation. The "provisional income" that determines how much Social Security is taxable under §86 is AGI excluding Social Security, plus tax-exempt interest, plus one-half of benefits - not the same as any MAGI here. See the Social Security Tax Calculator.
- Net operating losses and pass-through adjustments. NOL carryforwards and certain partnership or S-corp items affect AGI in ways a simple income-minus-adjustments model does not capture.
- State MAGI. Many states define their own modified AGI for state credits, often adding back out-of-state municipal bond interest. This guide covers federal MAGI only.
- Medicaid and CHIP MAGI. Medicaid uses a MAGI close to the PTC MAGI but with different household-composition rules. Eligibility is determined by the state agency.
Frequently Asked Questions
What to Do Next
If you have no foreign income, no tax-exempt interest, no IRA or student loan deduction, and no savings bond or adoption exclusion, your MAGI equals your AGI for every purpose. Use the single AGI figure from Form 1040 line 11 against the relevant threshold. Confirm the result with the AGI and MAGI Calculator.
Remember the IRA deduction and student loan interest are added back for the IRA and Roth MAGI. The levers that actually lower those MAGIs are AGI reductions that are not added back: a larger pre-tax 401(k) deferral, an HSA contribution, or a self-employed retirement plan. Run the numbers with the Roth IRA Contribution Calculator and the 401(k) Contribution Calculator.
A Roth conversion raises your IRMAA MAGI in the conversion year, and IRMAA uses MAGI from two years prior - so a conversion at age 63 can raise premiums at 65. Model the conversion against the two-year lookback before you convert. The Roth MAGI itself subtracts conversion income, so the conversion does not block future Roth contributions.
Foreign earned income exclusion and tax-exempt interest are added back for most MAGI figures, so a low AGI can still mean a disqualifying MAGI. Enter those amounts in the AGI and MAGI Calculator and check each benefit's MAGI individually before assuming you qualify.
- IRC §62 (Cornell LII) — Adjusted Gross Income Defined — the above-the-line deductions allowed in computing AGI: (a)(1) trade/business, (a)(2)(D) educator expenses, (a)(6) self-employed retirement, (a)(7) IRA, (a)(17) student loan interest, (a)(19) HSA, and others.
- IRS Publication 590-A — Contributions to IRAs — Worksheet 1-1 (traditional IRA deduction MAGI) and Worksheet 2-1 (Roth IRA MAGI), including the IRA deduction, student loan interest, foreign exclusion, savings bond, and adoption add-backs and the Roth conversion-income subtraction.
- IRS — 2026 Retirement Plan Limits (Notice 2025-67) — 2026 traditional IRA deduction and Roth phase-out ranges; IRA contribution limit $7,500 plus $1,100 catch-up.
- IRS — 2025 Roth IRA Contribution Limits (Notice 2024-80) — 2025 Roth and traditional IRA deduction phase-out ranges.
- IRC §36B(d)(2)(B) (Cornell LII) — Premium Tax Credit MAGI: AGI + tax-exempt interest + excluded foreign earned income + non-taxable Social Security benefits.
- IRC §25A (Cornell LII) — Education Credits — MAGI add-back of foreign earned income exclusion and Puerto Rico/American Samoa income; $80K-$90K / $160K-$180K phase-out frozen by FCAA 2020 §104.
- IRC §221 (Cornell LII) — Student Loan Interest — §221(b)(2)(D) MAGI definition (AGI without the §221 deduction, plus foreign and Puerto Rico/American Samoa add-backs).
- IRC §1411 (Cornell LII) — Net Investment Income Tax — 3.8% tax on the lesser of net investment income or MAGI over $200,000 single / $250,000 MFJ / $125,000 MFS; MAGI = AGI + net foreign earned income exclusion.
- IRS Instructions for Form 8960 (NIIT) — Net Investment Income Tax computation and MAGI definition.
- SSA POMS HI 01101.010 — Modified Adjusted Gross Income (IRMAA) — IRMAA MAGI = AGI + tax-exempt interest, using MAGI from the tax year two years prior to the premium year.
- IRS — Schedule 1-A, Additional Deductions — the OBBBA tips, overtime, car loan interest, and senior deductions flow to Form 1040 line 13b (below the AGI line) and are not used in computing AGI.
- IRS — About Schedule 1 (Form 1040) — Part II adjustments to income (above-the-line deductions) that reduce AGI.