Modified Adjusted Gross Income (MAGI): What It Is, How to Calculate It

Knowing your MAGI can help you figure out if you're eligible for certain tax deductions this filing season. Plus, learn how it differs from adjusted gross income.

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Updated Jun 20, 2025 · 3 min read

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What is modified adjusted gross income?

Modified adjusted gross income refers to your adjusted gross income (AGI) with certain deductions added back in. Your MAGI is important because it helps determine your eligibility for certain tax benefits, such as deducting traditional IRA contributions. It also determines whether you can contribute to a Roth IRA.

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How to calculate MAGI

Your MAGI figure can vary depending on your reason for calculating it, since some credits or tax programs that use MAGI to determine eligibility may require you to add back in different types of deductions. This three-step guide can help guide you through the process.

Step 1. Determine your gross income

Figuring out your MAGI begins with knowing your gross income, which includes all the money you earn, including a salary from a job, capital gains from selling a house or stocks, interest or retirement income, and even unemployment benefits.

Step 2. Figure your adjusted gross income

Your AGI is your gross income minus certain adjustments known as above-the-line deductions. Some of the most common items that are subtracted from gross income to determine AGI include:

IRA and 401(k) contributions.
Self-employed retirement plan contributions.
Half of any self-employment tax paid.
Health savings account deductions.
Student loan interest.
Some business expenses for the performing arts, military reservists and government officials who are paid directly from the public, such as a justice of the peace.

Step 3. Add back certain deductions

Finally, take your AGI and add certain deductions back. Although it may seem like you are subtracting certain items only to add them back again, there may be some difference between the two figures, so it’s important to go through the exercise — even if your AGI and your MAGI end up as the same number.

IRA contributions.
Half of self-employment tax paid.
Qualified tuition expenses.
Passive loss or income.
Non-taxable Social Security payments.
Exclusion for income from U.S. savings bonds.
Foreign earned income exclusion.
Foreign housing exclusion or deduction.
The exclusion under 137 for adoption expenses.
Rental losses.
Publicly traded partnerships losses.
Student loan interest deductions.

If this all sounds a bit complicated, thankfully, quality tax software can often simply and quickly help you determine your MAGI and how it relates to the tax benefits available to you.

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What is MAGI used for?

MAGI is used to determine eligibility for many credits and deductions. Some common credits that use MAGI income limits include the child tax credit, the American opportunity credit, and the lifetime learning credit.

It's also the basis for whether someone can deduct traditional IRA contributions and if they can contribute to a Roth IRA. People who make above a certain MAGI may be limited to a partial deduction or contribution — or none at all. Here's a quick look at how these income limits come into play for traditional and Roth IRAs.

Traditional IRA deductions

If you (or both you and your spouse) are not covered by a workplace retirement plan, you can take the full IRA deduction when you file your annual return. However, for those with employer-sponsored retirement plans, your MAGI determines whether you're eligible for this deduction and how much you can take.

For example, let's say you’re planning to file your taxes as a single person, you have a workplace retirement plan, and you contribute $7,000 to a traditional IRA in 2025. If your MAGI is $79,000 or less, you can deduct that full $7,000 from your taxable income on your 2025 tax return (filed in 2026). The table below shows how deductions change based on filing status and MAGI.

Traditional IRA deduction limits 2025

Filing status	2025 traditional IRA income limit	Deduction limit
Single or head of household (and covered by retirement plan at work)	$79,000 or less.	Full deduction.
	More than $79,000, but less than $89,000.	Partial deduction.
	$89,000 or more.	No deduction.
Married filing jointly (and covered by retirement plan at work)	$126,000 or less.	Full deduction.
	More than $126,000, but less than $146,000.	Partial deduction.
	$146,000 or more.	No deduction.
Married filing jointly (spouse covered by retirement plan at work)	$236,000 or less.	Full deduction.
	More than $236,000, but less than $246,000.	Partial deduction.
	$246,000 or more.	No deduction.
Married filing separately (you or spouse covered by retirement plan at work)	Less than $10,000.	Partial deduction.
	$10,000 or more.	No deduction.

» Learn more about the traditional IRA deduction limits

Roth IRA contributions

A Roth IRA is an account that lets you contribute money after you've paid taxes on it, and distributions in retirement are tax-free. To contribute to a Roth IRA, you have to meet certain income limits, which are based on your MAGI. Contributions are reduced, or not allowed, at certain income levels.

The table below outlines Roth IRA contribution limits for tax year 2025 (taxes filed in 2026).

Roth IRA income and contribution limits 2025

2025 Roth IRA income and contribution limits
Filing status	Modified gross adjusted income	Contribution limits
Single Head of household Married filing separately (if you didn't live with your spouse during the year)	Less than $150,000.	$7,000 ($8,000 if 50 or older).
	$150,000 or more, but less than $165,000.	Contribution is reduced.
	$165,000 or more.	No contribution allowed.
Married filing jointly Surviving spouse	Less than $236,000.	$7,000 ($8,000 if 50 or older).
	$236,000 or more, but less than $246,000.	Contribution is reduced.
	$246,000 or more.	No contribution allowed.
Married filing separately (if you lived with spouse at any time during year)	Less than $10,000.	Contribution is reduced.
	$10,000 or more.	No contribution allowed.

» Learn more about the Roth IRA income limits

Examples of calculating MAGI

Some programs and deductions calculate MAGI differently. Here are a couple of examples of how your MAGI could be calculated for various tax deductions and credits.

Example 1: Can you deduct traditional IRA contributions?

Add your AGI and the following: student loan interest deduction, foreign earned income and housing exclusions, foreign housing deduction, excluded savings bond interest and excluded employer adoption benefits.

If the number you arrive at is less than the traditional IRA deduction limit, then you can deduct the full amount. Depending on your filing status, and if you have a workplace retirement plan, those deduction limits can change. Regardless of your MAGI, you can take the full deduction if neither you nor your spouse are covered by a workplace retirement program.

Example 2: Are you eligible for certain education credits?

Add your AGI and the following: foreign earned income and housing exclusions, foreign housing deduction, excluded bona fide resident of Puerto Rico or American Samoa income.

Both the American opportunity credit and the lifetime learning credit are phased out at certain MAGI levels. To claim the full credit, your MAGI generally has to be $80,000 or less for single filers. That limit doubles for those married filing jointly. (Learn more about education tax credits.)

For single filers with a MAGI between $80,000 and $90,000, you’ll receive a reduced credit. After $90,000, you are not eligible for the credit.

For those married filing jointly, the phase-out lasts between $160,000 and $180,000, over which you are not eligible. If you file with the married filing separately status, you are not eligible for these tax credits.

» Learn more: What tax credits can I qualify for?

What's the difference between MAGI and AGI?

Your AGI is your total income minus any eligible deductions. Your MAGI is just your AGI with certain deductions added back, such as student loan interest, foreign-earned income and housing exclusions, and employer adoption benefits, among other things.

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