How to Calculate Modified Adjusted Gross Income (MAGI)

When it comes to taxes, health coverage, or IRA contributions, one term keeps popping up:
MAGI — Modified Adjusted Gross Income.

But what is MAGI exactly, and how do you calculate it?

In this simple guide, we’ll walk through what MAGI means, how it’s different from AGI, and how to calculate it step by step. We’ve also included a calculator to make things easier!

Want to calculate your Modified Adjusted Gross Income easily?
Use the calculator below—just enter your AGI and any deductions you took, and we’ll do the math for you.

🙋 What Is MAGI?

MAGI stands for Modified Adjusted Gross Income.

It’s your Adjusted Gross Income (AGI) with certain deductions added back. The IRS uses MAGI to determine eligibility for things like:

• Roth IRA contributions
• Premium tax credits (for health insurance)
• Student loan interest deductions
• Other income-based credits and benefits

🔀 How Is MAGI Different From AGI?

Your AGI is your gross income minus certain “above-the-line” deductions, like:

• Retirement contributions
• Student loan interest
• Health savings account (HSA) deductions

MAGI takes your AGI and adds some of those deductions back in.

🔢 Formula for MAGI

There’s no one-size-fits-all formula because MAGI depends on what tax credit or program you’re applying for.

But in most cases, the MAGI formula looks like this:

MAGI = AGI + Deductions You Took (e.g. student loan interest, foreign income, HSA contributions, etc.)

✏️ Example

Let’s say:

• Your AGI is $60,000
• You claimed a $2,000 student loan interest deduction
• And a $3,000 HSA deduction

Your MAGI would be:

$60,000 + $2,000 + $3,000 = $65,000

✅ Your MAGI is $65,000

💡 Why Does MAGI Matter?

The IRS uses MAGI to decide if you qualify for:

• Roth IRA contributions
• ACA health insurance subsidies
• Education tax credits (like the American Opportunity Credit)
• Child Tax Credit (CTC)
• And more…

It’s an essential number for tax planning!

🏁 Final Thoughts

Your Modified Adjusted Gross Income plays a big role in what tax benefits you qualify for—and it’s not as complicated as it sounds. Just start with your AGI and add back a few deductions. Our calculator makes it even easier!