MAGI on Form 1040, Line 11: IRAs, ACA, IRMAA, and NIIT

To calculate your Modified Adjusted Gross Income from Form 1040, Line 11, start with the Adjusted Gross Income shown on that line and add back a specific set of income items that depends on which tax provision you’re testing. There is no single MAGI number. A Roth IRA eligibility check, a healthcare subsidy calculation, and a Medicare premium surcharge each use a different formula, so the same taxpayer in the same year can have three different MAGIs.

Line 11 is the common starting point. What changes is what gets added back on top of it.

Why Line 11 Is the Right Starting Point

Your AGI on Form 1040, Line 11 is total income from all sources minus the above-the-line deductions on Schedule 1.¹ Every MAGI formula the IRS uses begins there. The add-backs exist because certain income items were either excluded from gross income (tax-exempt interest, foreign earned income, excluded savings bond interest) or subtracted on Schedule 1 (traditional IRA deduction, student loan interest). For a given tax benefit, the IRS wants a fuller picture of your resources than Line 11 alone shows.²

Which items get added back depends on which benefit is being tested. Municipal bond interest is added back when checking healthcare subsidies and Medicare surcharges but ignored for Roth IRA eligibility. The student loan interest deduction is added back for Roth IRA eligibility but ignored for healthcare subsidies. Before you can calculate your MAGI, you need to know which calculation you’re doing.

MAGI for Roth and Traditional IRA Contributions

This version of MAGI determines whether you can contribute to a Roth IRA at all and whether your traditional IRA contribution is deductible. Start with Line 11, then add back:²

The traditional IRA deduction taken on Schedule 1
The student loan interest deduction (up to $2,500) taken on Schedule 1
Foreign earned income and housing exclusions from Form 2555
Excluded savings bond interest from Form 8815 (the education bond program)
Employer-provided adoption benefits excluded on Form 8839
Excluded income from Puerto Rico, American Samoa, or other U.S. possessions

Two items get subtracted rather than added: income from converting a traditional IRA to a Roth, and rollovers from a qualified retirement plan to a Roth. Those amounts appear on your return but don’t count against your contribution eligibility.²

2026 Roth IRA Phase-Out Ranges

Compare the result to these ranges for the 2026 tax year:³

Single or head of household: phase-out from $153,000 to $168,000. No contribution allowed above $168,000.
Married filing jointly: phase-out from $242,000 to $252,000.
Married filing separately: phase-out from $0 to $10,000 (not inflation-adjusted).

Below the range, you can contribute the full $7,000 (or $8,000 at age 50 or older). Inside the range, your limit shrinks proportionally.

2026 Traditional IRA Deduction Phase-Outs

Same formula, different thresholds, which also depend on workplace plan coverage:³

Single filer covered by an employer plan: $81,000 to $91,000
Married filing jointly, contributing spouse covered by an employer plan: $129,000 to $149,000
Not covered, but spouse is covered: $242,000 to $252,000
Married filing separately, active participant: $0 to $10,000

If neither spouse is covered by a workplace plan, the full traditional IRA contribution is deductible at any income level.

MAGI for the Premium Tax Credit (ACA Subsidies)

Healthcare subsidies on the Marketplace use a shorter list. Start with Line 11 and add back three items:⁴

Tax-exempt interest (Form 1040, Line 2a) — municipal bond interest and similar
The non-taxable portion of Social Security benefits (Line 6a minus Line 6b)
Foreign earned income and housing amounts excluded on Form 2555

Notice what isn’t here: the student loan interest deduction, the IRA deduction, and the savings bond exclusion all stay out. The retirement MAGI and the ACA MAGI are not interchangeable.

The resulting number is compared to the Federal Poverty Line for your household size. The 2026 FPL in the contiguous 48 states is $15,960 for a single person and $33,000 for a family of four.⁵ Under the statute, the Premium Tax Credit is available to taxpayers with household income between 100% and 400% of the FPL.⁶ Enhanced subsidy rules first enacted in 2021 capped premium contributions at 8.5% of income even above 400% of the FPL; legislation (P.L. 119-21) made changes affecting the 2026 tax year, and the applicable rules should be confirmed on your Marketplace application for 2026 coverage.

MAGI for Medicare Part B and Part D Surcharges (IRMAA)

Of the common MAGI formulas, this one is the shortest. Social Security calculates the Income-Related Monthly Adjustment Amount as AGI plus tax-exempt interest, with no other add-backs.⁷

The number that matters is from two tax years earlier. Your 2026 Medicare premiums are set using your 2024 return.⁸ A one-time income event like a Roth conversion, business sale, or stock option exercise can trigger a surcharge that doesn’t show up until two years later.

The 2026 Part B surcharge brackets, based on 2024 MAGI, are:⁹

$109,000 or less ($218,000 joint): no surcharge
$109,001 to $137,000 ($218,001 to $274,000 joint): $81.20 per month
$137,001 to $171,000 ($274,001 to $342,000 joint): $202.90 per month
$171,001 to $205,000 ($342,001 to $410,000 joint): $324.60 per month
$205,001 to $499,999 ($410,001 to $749,999 joint): $446.30 per month
$500,000 or more ($750,000 or more joint): $487.00 per month

Part D carries a parallel surcharge at the same income brackets, ranging from $14.50 to $91.00 per month.⁹ At the top bracket, combined Part B and Part D surcharges add $578 per month, close to $7,000 per year, on top of the standard premiums.

MAGI for the Net Investment Income Tax

The 3.8% Net Investment Income Tax applies to the lesser of your net investment income or the amount by which your MAGI exceeds a fixed threshold:¹⁰

Single or head of household: $200,000
Married filing jointly: $250,000
Married filing separately: $125,000

These thresholds are not adjusted for inflation; they have been fixed since the tax took effect in 2013.

The formula is almost trivial. For NIIT purposes, MAGI is AGI plus any foreign earned income excluded under Section 911. If you don’t claim that exclusion, your MAGI and your AGI are the same number.¹¹

MAGI for Education Tax Credits

For the American Opportunity Tax Credit and the Lifetime Learning Credit, MAGI equals AGI plus two possible add-backs: foreign earned income and housing exclusions, and excluded income for bona fide residents of American Samoa or Puerto Rico.¹² If neither applies to you, your MAGI for education credits is simply Line 11.

The AOTC is worth up to $2,500 per eligible student and phases out between $80,000 and $90,000 of MAGI ($160,000 to $180,000 for joint filers). Above the top of the range, the credit is gone.¹³ The Lifetime Learning Credit uses the same MAGI definition with similar phase-out ranges.

MAGI for the $25,000 Rental Real Estate Loss Allowance

If you actively manage a rental property that generates a net loss, you can deduct up to $25,000 of that loss against non-rental income, subject to an income phase-out. The statute defines its own modified AGI for this purpose, adding back items like Social Security benefits, passive losses, and certain exclusions and deductions.¹⁴

The $25,000 allowance begins phasing out when this modified AGI exceeds $100,000. For every $2 above that figure, the allowance drops by $1, reaching zero at $150,000.¹⁴ These thresholds are fixed in the statute. Disallowed losses aren’t lost; they carry forward to offset future passive income or get released when you sell the property.

The Formulas Side by Side

Which items get added back to Line 11 for each MAGI:

Foreign earned income exclusion: added back for retirement contributions, healthcare subsidies, NIIT, and education credits. Not for IRMAA or the rental loss calculation.
Tax-exempt interest: added back for healthcare subsidies and IRMAA. Not for retirement contributions, NIIT, or education credits.
Non-taxable Social Security: added back for healthcare subsidies only.
Student loan interest deduction: added back for retirement contributions only.
Traditional IRA deduction: added back for retirement contributions only.
Excluded savings bond interest: added back for retirement contributions only.
Excluded adoption benefits: added back for retirement contributions only.

The retirement MAGI has the longest list. IRMAA and NIIT have one add-back each. The ACA formula sits in the middle. Match the formula to the question you’re trying to answer before you start.

What a Wrong MAGI Costs

Excess Roth or traditional IRA contributions caused by a miscalculated MAGI are hit with a 6% excise tax every year the excess remains in the account, reported on Form 5329.¹⁵ Withdrawing the excess, plus any earnings on it, before your filing deadline (including extensions) avoids the penalty.

Advance premium tax credits based on an income estimate that turns out to be too low get reconciled on Form 8962 at tax time. The difference is repaid with the return. For tax year 2025, repayment was capped for households between 100% and 399% of the FPL; for 2026, those caps have been eliminated, so the full overpayment is owed regardless of income level.

IRMAA won’t produce a filing penalty, because Social Security pulls the figure straight from your return. The risk is planning around it: a large Roth conversion or asset sale today raises your Medicare premiums two years from now. Running the IRMAA MAGI before pulling the trigger on a one-time income event is the only way to see the surcharge coming.

For education credits and the rental loss allowance, claiming an amount you don’t qualify for can draw the accuracy-related penalty, generally 20% of the underpayment. When your income is sitting near any of these phase-out thresholds, running the specific MAGI calculation the provision requires is the cheapest insurance you can buy.

1
Internal Revenue Service. Adjusted Gross Income
2
Internal Revenue Service. Modified Adjusted Gross Income
3
Internal Revenue Service. IRS Notice 25-67 – 2026 Amounts Relating to Retirement Plans and IRAs
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eCFR. 26 CFR 1.36B-1 – Premium Tax Credit Definitions
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HHS ASPE. 2026 Poverty Guidelines – 48 Contiguous States
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Office of the Law Revision Counsel. 26 USC 36B – Refundable Credit for Coverage Under a Qualified Health Plan
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Social Security Administration. HI 01101.010 – Modified Adjusted Gross Income (MAGI)
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Medicare.gov. 2026 Medicare Costs
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Centers for Medicare and Medicaid Services. 2026 Medicare Parts A and B Premiums and Deductibles
10
Internal Revenue Service. Topic No. 559 – Net Investment Income Tax
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Internal Revenue Service. 2025 Instructions for Form 8960 – Net Investment Income Tax
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Internal Revenue Service. Education Credits – Questions and Answers
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Internal Revenue Service. American Opportunity Tax Credit
14
Office of the Law Revision Counsel. 26 USC 469 – Passive Activity Losses and Credits Limited
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Internal Revenue Service. IRA Year-End Reminders