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Determining Your MAGI

Magi by Brian Whelan

There are income limits for contributing to an IRA (traditional and Roth), and below are links by filing status to illustrate the income limits in the situation where you are or are not covered by an employer-provided retirement plan, given your filing status.  This, along with your filing status and your Modified Adjusted Gross Income (MAGI) is an important factor in setting the limits for TIRAs, as there is the issue of deductibility at stake.

In order to fully understand the limitations, you also need to understand what makes up your Modified AGI (MAGI).  The MAGI is calculated as follows:

1.    Start with your Adjusted Gross Income (line 22, Form 1040A, or line 38, Form 1040).
2.    Add back in your IRA deduction amount (line 17 on Form 1040A or line 32 on Form 1040)
3.    Add back in your student loan interest (line 18 on Form 1040A or line 33 on Form 1040)
4.    Add back in any tuition and fees deductions from line 34 on Form 1040 (or line 19 on Form 1040A)
5.    Add any domestic production activities from line 35 on Form 1040 (there is no line for this on 1040A)
6.    Add back any foreign earned income exclusions from line 18 of Form 2555EZ or line 45 of Form 2555.
7.    Add back any foreign housing deduction from line 50 of Form 2555
8.    Add back any excluded qualified savings bond interest shown on line 3, Schedule 1, Form 1040A, or line 3, Schedule B, Form 1040 (from line 14, Form 8815)
9.    Add back in any excluded employer-provided adoption benefits shown on line 30, Form 8839.

The total of these nine items listed above make up your Modified Adjusted Gross Income, or MAGI.

For the IRA MAGI limitations where your income tax filing status is Single or Head of Household, click here. Note: if a taxpayer files Married Filing Separately and did not live with his or her spouse during the tax year, for the purposes of IRA eligibility that taxpayer is considered Single and would use this table. (click here for 2013 limits)

If your income tax filing status is Married Filing Jointly or Qualifying Widow(er), click here for the IRA MAGI limitations. (click here for 2013 limits)

For a tax filing status of Married Filing Separately, and you have lived with your spouse at any time during the tax year, click here for IRA MAGI limitations. (click here for 2013 limits)

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3 Comments

  1. [...] actual earned income compensation or $5,000 – provided your Modified Adjusted Gross Income (MAGI) is below the limits (see the MAGI article for current year [...]

  2. [...] not available in the Roth IRA (RIRA).  What this means is that, subject to the limits we discussed here, you may be able to deduct the amount of your contribution to your TIRA from your Gross Income in [...]

  3. [...] Note – this has been updated – 2013′s post is located at this link. [...]

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