How to calculate adjusted gross income (AGI), step by step
AGI is total income minus adjustments like student loan interest, HSA and half of self-employment tax. Steps for 2025, an invented example, last year's AGI.
Prepared by Prem Tax and Accounting Corp. Last checked against official sources on October 24, 2026.
Adjusted gross income is your total income minus certain adjustments. On the 2025 Form 1040, take total income from line 9, subtract the adjustments from Schedule 1, and the result is line 11a. IRS web pages still say line 11. AGI is not taxable income, which comes later, after your deductions.
- AGI equals total income (line 9) minus adjustments to income (Schedule 1, line 26, carried to line 10).
- Common adjustments: educator expenses up to $300 for 2025, student loan interest up to $2,500, half of self-employment tax, self-employed health insurance, HSA and IRA contributions, and the early-withdrawal penalty.
- Taxable income is AGI minus the standard or itemized deduction, the qualified business income deduction and the Schedule 1-A deductions.
- Many credits and deductions phase out by AGI or by MAGI, which is AGI with add-backs that differ for each benefit.
Three steps
Add up total income
Wages, interest, dividends, business profit, taxable retirement income and other income, through line 9 of Form 1040.
Subtract adjustments
Schedule 1, Part II lists them. The total on line 26 carries to line 10.
Read your AGI
Line 9 minus line 10 is line 11a.
An example (invented, tax year 2025)
| Item | Amount |
|---|---|
| Wages | $58,000 |
| Interest | $350 |
| Freelance net profit | $12,000 |
| Total income | $70,350 |
| Half of self-employment tax | $848 |
| Student loan interest | $1,200 |
| HSA contribution made outside payroll | $1,500 |
| Adjustments, total | $3,548 |
| Adjusted gross income | $66,802 |
Subtract the 2025 standard deduction for a single filer, $15,750, and about $51,052 remains before any qualified business income or Schedule 1-A deduction.
Two limits on adjustments
Alimony counts only under agreements made on or before December 31, 2018. Moving expenses count only for members of the Armed Forces and, newly, the intelligence community.
What to bring or do next
- Last year's return, since e-filing asks for the prior-year AGI.
- Records of HSA and IRA contributions, student loan interest and self-employment income.
- Ask us if you are self-employed, because the adjustments depend on net profit.
Common questions
Is AGI the same as taxable income?
No. Taxable income comes after AGI. You subtract the standard or itemized deduction, the qualified business income deduction and the Schedule 1-A deductions.
Where do I find last year's AGI?
On your prior-year Form 1040, in your IRS online account tax records, or on a free transcript. For a 2026 return filed in 2027, use the AGI from your 2025 return. First-time filers and those whose prior return was not processed enter $0.
What is MAGI?
Modified adjusted gross income is AGI with certain items added back. The add-backs differ by tax benefit, so check the rules for the credit or deduction you are testing.
Is the line number really 11?
The 2025 form shows AGI on line 11a, repeated on line 11b. Some IRS web pages still say line 11, so go by the form in front of you.
Official sources
- IRS: Adjusted gross income
- IRS: Form 1040 (2025)
- IRS: Schedule 1, additional income and adjustments to income (2025)
- IRS: Modified adjusted gross income
- IRS: Revenue Procedure 2024-40 (2025 amounts)
Keep reading
- Should I itemize or take the standard deduction?
- How much do you have to make to file taxes?
- Tax brackets for 2026
Let's talk about your taxes, your business, your plans.
Tell us what you need and we will get back to you quickly. There is no pressure: just a friendly conversation and a clear next step.
4260 Westbrook Dr, Suite 107
Aurora, IL 60504
Monday to Friday, 9:00 am to 5:00 pm, by appointment. Saturday and Sunday by appointment when needed.