Schedule 1-A, line 3

What is MAGI?

MAGI means modified adjusted gross income. For the car loan interest deduction it has one specific meaning: the amount on Schedule 1-A, Part I, line 3. The 2025 instructions say your MAGI for this phase-out is that line. It is not a generic “AGI plus whatever the internet adds back,” and it is not the MAGI formula printed on a different credit.

The six lines that make line 3

These lines are identical on the final 2025 Schedule 1-A and the June 16, 2026 draft.

1. Line 1: the amount from Form 1040, 1040-SR, or 1040-NR, line 11b. That is adjusted gross income.
2. Line 2a: any income from Puerto Rico that you excluded.
3. Line 2b: Form 2555, line 45.
4. Line 2c: Form 2555, line 50.
5. Line 2d: Form 4563, line 15.
6. Line 2e adds lines 2a through 2d. Line 3 adds line 1 and line 2e.

If you did not exclude Puerto Rico income and you are not filing Form 2555 or Form 4563, the instructions say to enter line 11b on line 3. For that common case, MAGI and AGI are the same number. Form 2555 is the foreign earned income exclusion. Form 4563 is the exclusion for bona fide residents of American Samoa. Leave those lines at zero if you did not file the form.

Why this MAGI does not include the car-loan deduction

The deduction is computed from line 3, and the result is entered later, on the 2025 Form 1040 at line 13b. Line 11b, AGI, is earlier on the return. The car-loan deduction therefore cannot change the MAGI that phases it out. You do not iterate. You also do not subtract the standard deduction before you test the $100,000 or $200,000 threshold. The threshold is compared with line 3, not with taxable income.

Head of household, married filing separately, single, and qualifying surviving spouse all use $100,000. Only married filing jointly uses $200,000. The final regulations say the statute sets those two amounts and does not give head of household a third threshold. The phase-out math itself is on the phase-out page.

A helper that stops at line 3

Enter line 11b and any add-backs. The helper adds them the way Part I does, then runs the car-loan phase-out if you also enter qualified interest. It treats that interest as already qualified. Eligibility is a separate checklist on the calculator.