Video: Introduction to Adjusted Gross Income and Taxable Income

In this lesson, Nick Palazzolo, CPA, takes a deep dive into the intricacies of Adjusted Gross Income (AGI) and taxable income, two crucial components in determining tax liability. He breaks down the differences between adjustments and deductions, illustrating how they can be utilized to reduce overall taxable income. With a focus on both 'above the line' and 'below the line' items, Nick simplifies the concept by explaining that adjustments reduce gross income to arrive at AGI, potentially qualifying taxpayers for additional benefits. He also unpacks the options available for deductions — choosing between standard and itemized deductions based on which results in greater tax savings. Nick makes sure to emphasize the importance of familiarizing oneself with tax forms and having the relevant figures at your fingertips, bolstering the ability to minimize tax liability effectively.