Only actual withdrawals from IRA's/401k's are included in the MAGI.
Here's something from SSS: (see formula at bottom)
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Taxes and your Social Security benefits
Frequently Asked Questions
Some people have to pay federal income taxes on their Social Security benefits. This usually happens only if you have other substantial income (such as wages, self-employment, interest, dividends and other taxable income that must be reported on your tax return) in addition to your benefits.
No one pays federal income tax on more than 85 percent of his or her Social Security benefits based on Internal Revenue Service (IRS) rules. If you:
file a federal tax return as an "individual" and your combined income* is
between $25,000 and $34,000, you may have to pay income tax on up to 50 percent of your benefits.
more than $34,000, up to 85 percent of your benefits may be taxable.
file a joint return, and you and your spouse have a combined income* that is
between $32,000 and $44,000, you may have to pay income tax on up to 50 percent of your benefits
more than $44,000, up to 85 percent of your benefits may be taxable.
are married and file a separate tax return, you probably will pay taxes on your benefits.
*Note:
Your adjusted gross income
+ Nontaxable interest
+ ½ of your Social Security benefits
= Your "combined income"
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As noted in formula above, the number that determines how much SS is taxed is your "combined income".............your AGI (w/o SS) will include any taxable IRA/401K withdrawals. The nontaxable INTEREST term may have been? what you were thinking about.........that basically means muni bond interest (including that from funds). The earnings in your IRA/401K would generally not have been interest (tho they could have been) nor were they nontaxable (tax deferred instead). Also note the 50/85% numbers above are NOT the tax rates on SS.....they just tell you how much of the SS would be included in your AGI for the purpose of calculating tax at your tax rate.