Modified AGI


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Modified Adjusted Gross Income

In the United States, the amount of income used to determine how much of a taxpayer's IRA contributions are tax deductible. One calculates the modified AGI by taking the adjusted gross income and adding back various deductions, notably interest on student loans, foreign income deductions, foreign housing deductions, and higher education costs. Depending on the modified AGI, some or all of one's IRA contributions will not be deductible.

Modified AGI (MAGI)

Modified adjusted gross income (MAGI) is a figure used to figure the limit on an exclusion or deduction allowed in computing adjusted gross income. Depending on the item for which MAGI is being computed, certain items taken into account in figuring adjusted gross income (AGI) are ignored. For example, for child tax credit purposes, MAGI is AGI plus any excluded foreign, U.S. possession, or Puerto Rican income. The IRS provides a worksheet for figuring MAGI whenever you are required to compute it.
References in periodicals archive ?
The taxpayer's modified AGI must be no more than $127,000/$ 108,000 in 2014 (MFJ) or $63,000/$54,000 in 2014 (other filing status).
If, however, Bob's salary is $124,000 and interest income remains at $6,000, the full $25,000 maximum cannot be utilized since Bob's modified AGI is $130,000.
Adoption credit--Line 51: The maximum adoption credit has risen to $10,000, and phases out over a higher range of modified AGI ($150,000-$190,000).
Coverdell Educational Savings Accounts Annual Contribution Limit $2,000 Contribution phase-out based on modified AGI Married Filing Jointly $190,000-220,000 All Others 95,000-110,000 2016 Student Loan Interest Deduction Maximum interest deduction $2,500 Deduction phase-out based on modified AGI Married Filing Jointly $135,000-165,000 All Others 65,000-80,000 American Opportunity Tax Credit Maximum Credit $2,500 Credit phase-out based on modifed AGI Married Filing Jointly $160,000-180,000 All Others 80,000-90,000 Lifetime Learning Credit Maximum Credit $2,000 Credit phase-out based on modifed AGI Married Filing Jointly $111,000-132,000 All Others 56,000-66,000 Fast Tax Facts provides general guidance to CalCPA members.
"Modified AGI" refers to AGI increased by net foreign income excluded by Sec.
At the same time, employer-provided assistance for adoption was excluded from income, and the threshold for the modified AGI phaseout increased from $75,000 to $150,000.
This $2,000 annual contribution limit is phased out ratably for individual taxpayers with modified AGI between $95,000 and $110,000, and for married taxpayers filing jointly with modified AGI between $190,000 and $220,000.
An exception allows you to deduct up to $25,000 in rental real estate losses against non-passive income, but this loss allowance is phased out beginning at $100,000 in modified adjusted gross income (AGO and eliminated once your modified AGI reaches $150,000.
For 2002, the contribution is phased out for joint filers with modified AGI of at least $190,000 and less than $220,000 (formerly between $150,000 and $160,000).
Benefits can be phased out when modified AGI reaches certain amounts built into the tax law (as with education credits).
Starting in 1998, the definition of modified AGI changed.
A taxpayer making a conversion or reconversion must satisfy the $100,000 modified AGI limitation, and a taxpayer transferring a contribution from one IRA to another IRA by means of a re-characterization must make the transfer on or before the due date for the taxable year of the contribution.

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