AGI
Definition
Adjusted gross income (AGI) is a number used to determine your federal income tax. AGI is your gross income minus deductions. Gross income includes wages, dividends, business profits, income from rental property and interest. Deductions include IRA contributions, SEP contributions, SIMPLE contributions, Keogh contributions, health insurance contributions (for self employed persons), trade or business expenses, depreciation on rental property, losses from sales of property, alimony payments, medical savings account contributions, moving expenses and charitable cash contributions. Note that AGI does not include standard or itemized deductions or personal exemptions. This figure appears on IRS Forms 1040, 1040A, and 1040EZ. Adjusted gross income level affects your eligibility for various types of retirement accounts, including Roth IRAs and Education IRAs.
Use AGI in a sentence
“ You need to make sure that the AGI of your staff is high enough so that you will be able to retain your best workers. ”
“ When completing taxes for the Federal Government, it is imperative that the AGI be correct so that the correct amount of taxes are paid. ”
“ Knowing your AGI will definitely be required when interfacing with the kind, caring and benevolent agents of the internal revenue service. ”
