What Is MAGI? How to Calculate Modified AGI (2026)

Ask five people what “MAGI” means and you’ll get five slightly different answers — and all five could be right. Modified Adjusted Gross Income is not a single line on your tax return. It’s a family of calculations, each starting from the same place (your AGI, Form 1040 line 11a on a 2025 return, line 11 on a 2024 return) and each adding back a different set of deductions and exclusions, because Congress wrote a different MAGI definition into each provision of the tax code.

Your Roth IRA MAGI, your Medicare IRMAA MAGI, your Net Investment Income Tax MAGI, and your ACA premium tax credit MAGI can all be different dollar amounts in the same tax year — even though they all start from the exact same AGI. Get the wrong MAGI and you’ll misjudge a Roth contribution limit, misread an IRMAA cliff, or misestimate a health insurance subsidy by thousands of dollars.

This guide breaks down what actually gets added back for each major MAGI-gated provision, walks through the 2026 phase-out numbers, and works two full examples so you can see the math. Use the MAGI Calculator to run your own numbers against all five provisions at once.

Start Here: AGI Is the Base for Every MAGI

Every MAGI calculation in the tax code starts from the same number: Adjusted Gross Income, Form 1040 — line 11a on a 2025 return, line 11 on a 2024 return. AGI is already net of above-the-line deductions like the IRA deduction, HSA contributions, and student loan interest — which is exactly why MAGI exists. Several of those above-the-line deductions and exclusions get added back for specific eligibility tests, because Congress didn’t want taxpayers reducing their AGI on paper (via a deduction) while still being economically high-income.

The six most common add-back items, drawn from IRS Publication 590-A Worksheet 2-1 and used across several MAGI definitions, are:

Not every provision uses all six. That’s the entire point of this article — each program below picks its own subset.

MAGI by Program: What Actually Gets Added Back

This is the detail that trips people up: tax-exempt interest is added back for IRMAA and ACA, but not for Roth IRA or Traditional IRA deduction purposes. A retiree holding $50,000 of municipal bond interest can have very different MAGI figures depending on which eligibility test they’re running — even in the same year, on the same return.

For everyday planning, the MAGI Calculator computes one approximate “common MAGI” (AGI plus all six add-backs) that’s a close stand-in for Roth, IRMAA, and NIIT purposes in the typical case — but if you have tax-exempt interest and you’re specifically testing Roth or Traditional IRA eligibility, use the narrower definition above instead.

Step-by-Step: Computing MAGI

1. Start with AGI — Form 1040 — line 11a on a 2025 return, line 11 on a 2024 return.
2. Identify which provision you’re testing — Roth contribution, IRMAA, NIIT, ACA subsidy, or the traditional IRA deduction. Each has its own add-back list (table above).
3. Add back only the items that provision requires. Don’t add back items a provision ignores — that’s the single most common error.
4. Compare against the provision’s own threshold or phase-out band (below).
5. Re-run the calculation any year your income changes materially — MAGI tests are annual, not lifetime.

Worked Example 1 — Roth IRA Phase-Out

Dana, single, age 40, 2026 tax year.

Wait — Dana also has $3,000 of tax-exempt municipal bond interest. Since tax-exempt interest is not an add-back for the Roth IRA MAGI test, it stays out. Dana’s Roth MAGI is simply her AGI of $158,000.

The 2026 Roth IRA phase-out band for single filers is $153,000–$168,000 — a $15,000-wide range. Dana’s $158,000 MAGI sits $5,000 into that range:

Position in band = ($158,000 − $153,000) / $15,000 = 33.3%

Dana is under age 50, so her uncapped 2026 contribution limit is the base amount, $7,500 (no $1,100 catch-up). Applying IRS Publication 590-A Worksheet 2-2:

Reduced limit = $7,500 × (1 − 0.333) = $5,002.50
Rounded up to the next $10 = $5,010

Dana can contribute $5,010 directly to a Roth IRA for 2026 — a partial contribution. If she wanted to fund the remaining $2,490 of her limit, the standard workaround is a Backdoor Roth IRA: a non-deductible Traditional IRA contribution immediately converted to Roth, which has no MAGI limit at all.

Worked Example 2 — The IRMAA Cliff

Mark and Linda, married filing jointly, both age 67 and enrolled in Medicare. They’re deciding whether to do a $15,000 Roth conversion in 2026.

The 2026 IRMAA tier boundaries for MFJ are: tier 0 (no surcharge) up to $218,000, then tier 1 from $218,000 to $274,000 carries a $81.20/month Part B surcharge and a $14.50/month Part D surcharge — per Medicare beneficiary.

Without the conversion, Mark and Linda’s $208,000 MAGI stays comfortably under the $218,000 tier-0 ceiling — no surcharge. With the conversion, their MAGI jumps to $223,000, crossing $5,000 into tier 1. Because IRMAA is a cliff, not a phase-in, that $5,000 overage triggers the full tier-1 surcharge for the entire year — for both spouses if both are enrolled in Medicare:

$81.20 + $14.50 = $95.70/month per person
$95.70 × 2 spouses = $191.40/month
$191.40 × 12 = $2,296.80/year

A $5,000 income bump costs the household $2,296.80 in extra Medicare premiums — a marginal rate on that last $5,000 that dwarfs their income-tax bracket. And because IRMAA looks back two tax years, this 2026 MAGI won’t hit their premiums until 2028 — long after the conversion decision is locked in and irreversible.

The Other Two MAGI Flavors

NIIT. For a domestic filer with no foreign earned income, NIIT MAGI is simply AGI — no add-backs apply in the ordinary case. The 3.8% surtax applies to the lesser of net investment income or the excess of MAGI over $200,000 (single/HoH), $250,000 (MFJ/qualifying widow(er)), or $125,000 (MFS). See the full breakdown in the NIIT guide.

ACA Premium Tax Credit. ACA MAGI adds back tax-exempt interest, the FEIE/housing exclusion, and nontaxable Social Security benefits — a broader add-back list than any other program on this page. For the 2026 plan year, the enhanced (no-cliff) subsidy structure that applied 2021–2025 expired on December 31, 2025 and was not extended by OBBBA. The pre-ARP structure is back: a hard cliff at 400% of the Federal Poverty Level — cross it and the subsidy drops to $0, not a gradual phase-out. Below 400% FPL, the applicable percentage of income you’re expected to contribute toward the benchmark plan ranges from 2.10% (100–133% FPL) up to 9.96% (250–400% FPL) under the 2026 table in IRS Revenue Procedure 2025-25. Full mechanics and a worked subsidy example are in the ACA premium tax credit guide.

The Traditional IRA Deduction’s Own MAGI

The traditional IRA deduction has a MAGI test most people have never heard of, separate from the Roth contribution test — and it uses different thresholds. For 2026 (IRS Notice 2025-67):

Notice the third row: a non-participating spouse married to someone with a workplace plan gets the same $242,000–$252,000 band as the 2026 Roth IRA MFJ phase-out — a coincidence that makes it easy to conflate the two tests, but they are legally distinct provisions (§219(g) vs. §408A(c)(3)) that happen to share a number this year.

Where People Go Wrong

• Assuming tax-exempt municipal bond interest is invisible everywhere. It’s genuinely excluded from AGI and stays out of the Roth IRA and Traditional IRA deduction MAGI tests — but it’s added straight back for IRMAA and the ACA premium tax credit. A large muni bond position can blow past a Medicare premium cliff even while doing nothing to your Roth eligibility.

• Forgetting the foreign earned income exclusion add-back. Expats who zero out their AGI using the §911 exclusion often assume they’re “MAGI-poor” across the board. In reality, nearly every MAGI test on this page adds the excluded foreign income right back — so a high-earning expat with $0 AGI can still be fully phased out of a Roth IRA contribution or over the ACA subsidy cliff.

• Not realizing the student loan interest deduction doesn’t help your MAGI. It lowers your AGI on the way in, but for the Roth IRA and Traditional IRA deduction tests it’s added straight back out. Don’t count on it to nudge you under a phase-out threshold.

Related Reading

• Backdoor Roth IRA guide — the standard workaround once your Roth MAGI phases you out of a direct contribution
• Net Investment Income Tax (NIIT) guide — the 3.8% surtax that uses its own MAGI test
• ACA Premium Tax Credit guide — how the broadest MAGI definition on this page drives your health insurance subsidy

FAQs

Is MAGI always higher than AGI?

Almost always equal to or higher — MAGI only adds back items, it never subtracts anything AGI already includes. If you have none of the applicable add-back items for a given test (no tax-exempt interest, no foreign income exclusion, etc.), your MAGI for that test simply equals your AGI.

Which MAGI should I use if a tool only asks for “MAGI”?

Check what the tool is testing. A Roth IRA contribution calculator wants the narrower Roth-specific MAGI (no tax-exempt interest add-back); an IRMAA or ACA subsidy calculator wants the broader definition that includes it. The MAGI Calculator computes both the common approximation and flags which programs use a narrower or different test.

Does a Roth conversion increase my MAGI?

Yes — a Roth conversion is taxable income and flows straight into AGI, which is the base for every MAGI test on this page. This is exactly what makes Roth conversion sizing a MAGI-management exercise for retirees near an IRMAA tier or NIIT threshold, not just an income-tax bracket exercise.

Can I reduce my MAGI after year-end?

No — MAGI is fixed once the tax year closes; there’s no year-end “MAGI harvesting” the way there is tax-loss harvesting. The only levers are ones that affect AGI or the specific add-back items during the tax year: HSA contributions, traditional 401(k) deferrals (which reduce AGI directly, unlike a traditional IRA deduction that gets added back for some tests), timing capital gains, or the size of a Roth conversion.

Do state MAGI definitions match the federal ones?

Not necessarily. States that have their own income-based programs (health insurance subsidies, property tax circuit breakers, Medicaid) often define MAGI under state statute, which can diverge from every federal definition above. Always check the specific state program’s own worksheet rather than assuming a federal MAGI figure transfers over.