We continue to get a few questions on what is adjusted gross income (AGI) and how to calculate it.
First, this is a simple three-year average of AGI. For 2023, you will use 2019, 2020 and 2021. For 2024, you will use 2020, 2021 and 2022.
Total AGI is fairly simple for individuals. It is line 11 from Form 1040. For corporations, it is Form 1120, line 30 plus line 19 (charitable contributions). S-corporations only use Form 1120-S page 1, line 21. Nothing on Schedule K is included. LLCs, etc. taxed as a partnership use Form 1065, page 1, line 22 plus line 10 (guaranteed payments).
This is the base number you will use.
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