Modified Adjusted Gross Income - MAGI
Definition of 'Modified Adjusted Gross Income - MAGI'The amount of income that determines how much of an individual's IRA contribution is deductible. The modified adjusted gross income is found by taking the individual's adjusted gross income and adding back certain items such as foreign income, foreign-housing deductions, student-loan deductions, IRA-contribution deductions and deductions for higher-education costs. |
|
Investopedia explains 'Modified Adjusted Gross Income - MAGI'The higher the modified adjusted gross income, the more the deductible amount of the IRA contribution will be reduced, possibly going down even to zero. If this happens, one can still contribute to an IRA plan, it's just that the whole amount contributed will not be tax deductible. The amount calculated in MAGI will often be similar or even the same as adjusted gross income. |
Related Definitions
Articles Of Interest
-
How IRA Contributions Affect Your Taxes
Learn how to work with the tax man to avoid getting gouged when you convert your plans. -
Avoid The Social Security Tax Trap
Government benefits can cost you big money! Know the income thresholds before you file. -
Traditional IRA Deductibility Limits For 2011
Find out where you can take a tax deduction on the contributions you make. -
4 IRA Changes That Encourage Savings
Find out what's new in the world of IRAs and how you can get more bang for your buck. -
Earnings within a Roth IRA are tax free, so are these earnings included in the modified adjusted gross income which is used to determine Roth IRA eligibility?
There are two possible answers to this question, depending on whether or not the distribution from the Roth IRA is qualified.Earnings on investments within a Roth IRA are neither subject to income ... -
How do I get credit for my retirement plan contributions?
There is an added incentive for adding to your retirement nest egg, if your income falls within certain limits. Under this incentive program, you are eligible for a non-refundable tax credit ... -
Roth IRAs Tutorial
This comprehensive guide goes through what a Roth IRA is and how to set one up, contribute to it and withdraw from it. -
The Hidden Fees In 401(k)s
Learn about the conspicuously disclosed fees that lurk within your 401(k) investments. -
Should You Buy An Annuity?
For many cash strapped seniors an annuity sounds like the perfect solution. And it can be if you think you’ll outlive your mortality date. The only trouble is that the insurance companies offering ... -
Analyzing The Best Retirement Plans And Investment Options
Understanding the various retirement investments - from annuities to 401(k)s and everything in between - is crucial to reaching your retirement goals. Here, we examined many of the popular investments ...
Free Annual Reports