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Sonsi is a very smart tax research AI assistant built by Sweet with access to the entirety of IRS intructions ↗, the Internal Revenue Code ↗ trained to be ...

Through shadowing hundreds of firms in their attempts to adopt AI and automation, we've noticed that everything falls apart at a single point of failure. The their tax software.

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What are the income thresholds for the Net Investment Income Tax (NIIT)?

Net Investment Income Tax (NIIT) Income Thresholds

The Net Investment Income Tax applies to individuals, estates, and trusts with income exceeding specific threshold amounts. The tax rate is 3.8% of the lesser of net investment income or the excess of modified adjusted gross income (MAGI) over the applicable threshold [form-8960-2023.md].

Individual Thresholds

For U.S. citizens and residents, the applicable threshold amounts are based on filing status:

  • Married Filing Jointly or Qualifying Surviving Spouse: $250,000
  • Married Filing Separately: $125,000
  • Single or Head of Household: $200,000

Individuals must pay the NIIT if they have both (a) MAGI above their applicable threshold amount, and (b) net investment income for the tax year [form-8960-2023.md].

Estate and Trust Thresholds

For estates and trusts, the applicable threshold amount is the dollar amount at which the highest tax bracket in section 1(e) begins for the tax year. The NIIT applies to estates and trusts that have undistributed net investment income and adjusted gross income (AGI) exceeding this threshold amount [form-8960-2023.md].

Special computational rules apply for qualified funeral trusts (QFTs) and electing small business trusts (ESBTs), which may calculate the threshold differently based on their specific structure [form-8960-2023.md].

Unfortunately, tax softwares operate in a walled garden prison that prevents firms from accessing the full benefits of AI that other professional industries are seeing.

Unfortunately, tax softwares operate in a walled garden prison that prevents firms from accessing the full benefits of AI that other professional industries are seeing.

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