Actually it is Modified Adjusted Gross Income (MAGI).
A taxpayer may deduct up to $25,000 in rental real estate losses as long
as the taxpayer actively participates and MAGI is less than $100,000. For every $2 a taxpayer’s MAGI exceeds $100,000, the
allowance is reduced by $1.
Modified adjusted gross income (MAGI) for FORM 8582 line 7 is determined by computing:
AGI without:
- Any passive loss or passive income, or
- Any rental losses (whether or not allowed by IRC § 469(c)(7)), or
- IRA, taxable social security or
- One-half of self-employment tax (IRC § 469(i)(3)(E)) or
- Exclusion under 137 for adoption expenses or
- Student loan interest.
- Exclusion for income from US savings bonds (to pay higher education tuition and fees)
- Qualified tuition expenses (tax years 2002 and later)
- Tuition and fees deduction
- Any overall loss from a PTP (publicly traded partnership)
