Modified Adjusted Gross Income (MAGI) includes which of the following?

Modified Adjusted Gross Income (MAGI) is an important measure used for various tax calculations and eligibility for certain benefits. The correct characterization of MAGI is that it includes your Adjusted Gross Income (AGI) plus certain specific exclusions and deductions.

To clarify further, AGI serves as a base figure that reflects an individual's total income after subtracting specific deductions, such as retirement plan contributions and student loan interest. MAGI then adjusts AGI by adding back certain deductions and exclusions that may not be included in AGI, which can include tax-exempt interest income and others depending on the context and purpose (like eligibility for certain credits or deductions).

Therefore, the characterization provided in answer B accurately reflects the appropriate components of MAGI, making it the correct choice. The other options do not capture the full definition of MAGI; for example, only taxable income fails to account for the adjustments made from AGI and misses key inclusions. Overall, understanding MAGI is crucial for navigating tax regulations and eligibility for various benefits.