The days of paper tax forms are a distant memory to most US taxpayers — almost 98% of the tax returns received by the IRS so far in 2024 have been electronic. The best tax software lets you avoid learning all of the complicated rules for income taxes and should even deliver your refund faster.
However, there’s one tax term you’ll need to figure out on your own in order to even file your tax return online: adjusted gross income, or AGI.
You’ll need your AGI from last year’s taxes to verify your identity online when you file in 2024, but this year’s AGI is important too. It will have an impact on the tax deductions and tax credits you can claim, as well as your tax bracket and tax rate.
Learn everything you need to know about AGI, how to find last year’s info and what to do if you can’t locate it. For more tax tips, learn when your taxes are due and how to track your tax refund.
What is adjusted gross income, or AGI?
Also called “taxable income,” your adjusted gross income includes all of the money you earned in a year minus certain adjustments. These adjustments are also called “above-the-line deductions,” meaning you can use them to reduce your taxable income even if you take the standard deduction and don’t itemize.
Some of the above-the-line deductions that lower your AGI include:
- Retirement account contributions
- Student loan interest
- Health savings account contributions
- Alimony payments
- Educator expenses
- Eligible education expenses
- Moving expenses for members of the armed forces
- Some expenses for eligible artists
- One-half of the self-employment tax
Why do I need my AGI from 2023 to file taxes online in 2024?
The IRS uses your AGI from the previous year to verify your identity when you file taxes electronically. You can also use last year’s five-digit Self-Select PIN, if you created one.
How can I find my AGI from last year?
The easiest way to find last year’s AGI is to look at your 2023 tax return, specifically Line 11 of Form 1040. If you used online tax software to file last year, you can log into your account and look up your 2023 tax return there.
If you don’t have last year’s return and can’t access it online, you can also find your AGI from your 2023 taxes with an online IRS account, though you’ll need to go through a separate identity verification process to create an account if you don’t have one. Once you’re logged into your IRS account, you can get a transcript of last year’s taxes that shows your AGI.
If you don’t want to create an IRS account, you can also use Form 4506-T to request a tax transcript through the mail.
What should I use for last year’s AGI if I didn’t file a return last year?
If you didn’t file taxes in 2023 or you’re a first-time tax filer in 2024, simply put $0 for your AGI. If you are filing jointly and one of you didn’t file last year, put $0 for the person who didn’t file. Most online tax software will simply ask you if you filed and enter $0 automatically if you didn’t.
What is MAGI, or modified adjusted gross income?
Your modified adjusted gross income, or MAGI, is another important number that can potentially impact your tax refund. Your MAGI is determined by adding back some deductions used to calculate AGI.
The most common of these deductions that are included to calculate MAGI are:
- Student loan interest
- Nontaxable Social Security benefits
- Tax-exempt interest
- Foreign-earned income
- One-half of the self-employment tax
For most taxpayers, AGI and MAGI will be very similar, but a difference can be critical, as some credits and deductions use thresholds based on MAGI. Your MAGI will determine if you qualify for a Roth IRA and if your retirement contributions are deductible.
Several tax credits also use MAGI to determine eligibility or phase out, including the child tax credit, the education expenses credits and the premium tax credit for help with health insurance plans from the public marketplace.
For more tax tips, learn what to do if you didn’t get your W-2 form this year and how to tweak your W-4 to get a bigger (or smaller) tax refund.
