Adjusted gross income (AGI) is your annual gross income minus certain tax deductions. Your AGI is used to calculate how much of your income is subject to tax. Some tax credits use AGI to determine if a person is eligible for the credit. For married couples filing jointly, calculating AGI requires combining both spouses’ incomes and deductions, which can lead to nuances in eligibility for various credits and deductions based on their combined financial situation.
What AGI to report if Married Filing Jointly
If you are married for even one month out of the year, the IRS requires you to enter prior-year AGIs for both you and your spouse. To find your prior-year AGI, you can look at your last year’s tax return. It’s located on Line 11 of the Form 1040. If you can’t find your past return, you can contact the IRS directly to request a copy of your tax return or transcript.
Be aware that the AGI you enter must match what the IRS records show for your Social Security number, or your return will be rejected.
There are four scenarios to consider when looking at your married AGI.
You and your spouse filed as Married Filing Jointly last year
If you filed Married Filing Jointly last year, put the same number for both of your AGIs this year. When you file jointly, the IRS views you as one taxed entity, meaning you have the same combined AGI. This applies even if you or your spouse did not earn any money last year.
You and your spouse filed as Married Filing Separately last year
If you filed last year, enter your different separate AGIs from each of your individual prior year returns. When you file separately, both must file a unique return, meaning you will have two separate AGIs.
You and your spouse were not married last year and filed as Single
If you filed as Single because you were not married on your return last year, follow the same directions as those who filed Married Filing Separately. Enter each individual’s AGI from your return last year since you were two taxable entities.
One or both of you did not file a return last year
If either you or your spouse or both of you did not file a return last year, enter a 0 for the person’s AGI. It can impact your Modified Adjusted Gross Income (MAGI) calculations for eligibility for certain tax credits or deductions.
What AGI should you report for Married Filing Separately?
When filing as Married Filing Separately (MFS), each spouse needs to report their own Adjusted Gross Income (AGI) individually. This means that your AGI should only include your own income, deductions, and credits, not a combined amount. If you had filed jointly in the previous year but decide to file separately this year, you must be mindful that certain tax provisions, like the standard deduction, are significantly lower for MFS filers. Keep in mind that choosing this filing status could change the tax benefits you get. For example, you might not get certain credits like the Earned Income Tax Credit, and your standard deduction will be lower than if you filed jointly. If one of you decides to itemize deductions, the other has to do the same, even if their deductions are less than the standard deduction.
