1. What is MAGI?

Modified Adjusted Gross Income (MAGI) is a variation of your Adjusted Gross Income (AGI) that adds back certain deductions. It's used to determine eligibility for various tax benefits, health insurance subsidies, and government programs.

2. How MAGI is Calculated

The standard MAGI formula is:

Common additions to AGI to calculate MAGI include:

• Tax-exempt interest (like from municipal bonds)
• Foreign earned income exclusion
• Non-taxable Social Security benefits
• Excluded employer adoption benefits
• Student loan interest deduction
• Tuition and fees deduction

3. Importance of MAGI

Details: MAGI is crucial for determining eligibility for:

• Premium tax credits under the Affordable Care Act
• Medicaid and CHIP eligibility
• Roth IRA contribution limits
• Traditional IRA deduction limits
• Education-related tax benefits

4. Using the Calculator

Tips:

• Enter your AGI from your tax return (Line 11 on Form 1040 for 2022)
• Include all relevant additions to calculate your specific MAGI
• Different programs may have slightly different MAGI calculations

5. Frequently Asked Questions (FAQ)

Q1: Is MAGI the same for all purposes?
A: No, different programs may use slightly different MAGI calculations. Always check the specific requirements for the program you're applying for.

Q2: Where can I find my AGI?
A: Your AGI is on Line 11 of your Form 1040 tax return. You can also find it on IRS transcripts.

Q3: Are retirement contributions included in MAGI?
A: Traditional IRA contributions are added back to AGI for Roth IRA MAGI calculations, but not for ACA purposes.

Q4: How does MAGI affect health insurance?
A: MAGI determines eligibility for Medicaid and premium tax credits on the Health Insurance Marketplace.

Q5: Is Social Security income included in MAGI?
A: Only the taxable portion is included in AGI, but for some MAGI calculations, non-taxable Social Security benefits are added back.