What is adjusted gross income (AGI)?
When filing your taxes, you may wonder, “what is my AGI?” Adjusted gross income is your gross income minus any adjustments to your income, such as student loan interest, alimony payments, or retirement account contributions.
Gross income includes your wages, capital gains, retirement distributions, dividends, and any other form of income. As you prepare your tax return, it’s important to note that your AGI will never total more than your Gross Total Income.
Where do you find your AGI on your tax return?
It’s important to know how to find your AGI on your tax return because it’s used to determine your income tax liability. Your AGI will be found on line 11 of your 2024 Form 1040, 1040-SR, and 1040-NR. If you plan to e-file your tax return, you may need to first find the amount of AGI from last year’s return in order for the IRS to verify your identity. You can find your AGI on the form you used to file your last year’s return.
Various versions of Form 1040 reflect the AGI amount on different lines:
- line 11 on Form 1040, 1040-SR and 1040-NR (2020 through 2024 tax years)
- line 8b on Form 1040 and 1040-SR (2019 tax year)
- line 7 on Form 1040 (2018 tax year)
- line 21 on Form 1040A (tax years before 2018)
- line 4 on Form 1040EZ (tax years before 2018)
You can find the name of your tax form on the upper left-hand corner of your return. If you used online tax software, you can typically login and download a copy of your prior year’s 1040 tax return to find your AGI.
How do you calculate your adjusted gross income?
The IRS defines AGI as “gross income minus adjustments to income.” Depending on the adjustments you’re allowed, your AGI will be equal to or less than the total amount of income or earnings you made for the tax year.
When calculating your adjusted gross income, you’ll need to consider all of your sources of income, including:
- wages on a W-2 or 1099 form
- self-employment income on a Schedule C
- interest and dividends
- alimony from an ex-spouse (for agreements prior to 2019)
- capital gains
- rental income
- other earnings subject to income tax
AGI doesn’t include your standard or itemized tax deductions, so set those aside to figure into your taxable income later. After calculating your total income, the next step is subtracting any adjustments.
Adjustments can include:
- student loan interest
- educator expenses
- alimony paid
- retirement account contributions
- certain business expenses for self-employed workers
- health savings account (HSA) contributions
- Instructions for Form 1040 and Form 1040-SR have a complete list of all eligible adjustments.
After subtracting your adjustments from your total income earned, you’ll get your AGI, which will be reported on line 11 of Form 1040.
Why is AGI important?
In addition to being used to verifying your identity, your AGI impacts many of the tax deductions and credits you can take at tax time. That’s especially important because deductions and credits can increase your tax refund or reduce the amount of taxes you owe. Depending on your filing status, you may be subject to a limit on your deductions based on your AGI which usually applies to higher income earners. Source