How to Determine My Modified Adjusted Gross Income

by John Csiszar, studioD

Calculating your modified adjusted gross income is an important step in determining your total tax obligation. Numerous deductions and credits are related to the amount of your MAGI, and a higher MAGI may render you ineligible for certain tax benefits. For example, you may not be able to take a deduction for student loan interest if your MAGI is too high. You also lose the ability to deduct your contribution to an individual retirement account if your MAGI is above a certain level. MAGI calculations are straightforward, consisting primarily of your total income minus certain allowable deductions.

Step 1

Enter all of your income on IRS Form 1040. Lines 7 through 21 of this form are where you report all of your income to the Internal Revenue Service, including tax-exempt income, salaries, wages, dividends, interest, alimony, capital gains, IRA distributions, rental and farm income, unemployment compensation, and Social Security benefits. Total your income on line 22.

Step 2

Take your allowable deductions. Lines 23 through 35 of Form 1040 allow you to deduct certain expenses to calculate your adjusted gross income, a precursor to your modified adjusted gross income. These include educator and moving expenses, self-employment tax and health insurance deductions, IRA contributions, student loan interest, and certain education expenses. Total these deductions on line 36 and subtract them from your total income on line 22. The remaining value is your adjusted gross income.

Step 3

Remove certain deductions from your AGI to calculate your MAGI. The IRS considers your MAGI to be your AGI minus eight deductions and exclusions. To compute your MAGI, subtract the deductions for student loan interest, IRA contributions, tuition and fees, domestic production activities, and foreign earned income. You'll also have to subtract the foreign housing exclusion, the exclusion of qualified savings bond interest and the exclusion of employer-provided adoption benefits. The result is your MAGI.

Photo Credits

  • Form 1040 Tax Forms image by Viola Joyner from

About the Author

After receiving a Bachelor of Arts in English from UCLA, John Csiszar earned a Certified Financial Planner designation and served 18 years as an investment adviser. Csiszar has served as a technical writer for various financial firms and has extensive experience writing for online publications.

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