Term

Adjusted gross income (AGI)

Definition

Adjusted gross income equals total income less reductions that are allowable, regardless of whether personal deductions are itemized.

Term

Deductions

Definition

Amounts that may be subtracted from income that is otherwise taxable.

Term

Earned income

Definition

Income from personal services as distinguished from income generated by property or other sources. Earned income includes all amounts received as wages, tips, bonuses, other employee compensation, and self-employment income, whether in the form of money, services, or property.