For United States individual income tax, adjusted gross income (AGI) is total gross income minus specific reductions.[1] Taxable income is adjusted gross income minus allowances for personal exemptions and itemized deductions. For most individual tax purposes, AGI is more relevant than gross income.
Source: Wikipedia
These deductions reduce AGI. Amounts deductible against gross income in arriving at adjusted gross income (AGI) are called “above-the-line” deductions.
- Educators Expenses – Teachers’ Classroom Expenses
- Business Expenses for Certain Employees
- Health Savings Account Deduction
- Moving Expenses
- Self-Employment Tax
- Self-Employed SEP, SIMPLE, and Qualified Plans
- Self-Employed Health Insurance
- Penalty on Early Withdrawal of Savings
- Alimony Paid
- IRA Deduction
- Student Loan Interest
- Tuition and Fees
- Domestic Production Activities
If the total of a taxpayers itemized deductions is greater than standard deduction for the applicable filing status, Schedule A should be used.
