Updated October 1, 2026. Quick answer: For 2026 the net investment income tax (NIIT) is 3.8% of the lesser of your net investment income or the amount your modified adjusted gross income exceeds $200,000 for single and head of household filers, $250,000 for married filing jointly and $125,000 for married filing separately. The dollar thresholds are written into the statute.
Related reading on this site: IRS Publication 527.
Foreign tax credit (Form 1116) and alternative minimum tax (Form 6251) for 2025, read line by line: Form 1116 lines 20 to 24, Form 1116 line 35 and Form 6251 Part III.
Schedule D and Schedule E (Form 1040) for 2025, read line by line: Schedule D line 20.
Related reading on this site: Form 8959 Additional Medicare Tax.
Schedule 2 (Form 1040) for 2025, read line by line: Schedule 2 lines 10 and 11 and Schedule 2 line 12.
The shareholder’s Schedule K-1 (Form 1120-S), boxes 13 to 19: Schedule K-1 boxes 14 and 15 and Schedule K-1 box 17 codes A, B and U.
The shareholder’s Schedule K-1 (Form 1120-S), read box by box: Schedule K-1 box 3, Schedule K-1 boxes 7 and 8 and Schedule K-1 box 10.
The partner’s Schedule K-1 (Form 1065), read box by box: Schedule K-1 box 11, Schedule K-1 box 13 and Schedule K-1 box 14.
The partner’s Schedule K-1 (Form 1065), read box by box: Schedule K-1 box 5, Schedule K-1 box 6 and Schedule K-1 box 7.
More IRS forms and schedules, read line by line: Schedule 2 instructions.
More IRS forms and schedules, read line by line: Form 4952 instructions.
Price a sale against the 2026 capital gains rates: capital gains tax calculator.
The IRS form or worksheet behind this, read line by line: Form 8960 instructions.
2026 NIIT thresholds
| Filing status | Modified adjusted gross income threshold |
|---|---|
| Married filing jointly or qualifying surviving spouse | $250,000 |
| Married filing separately | $125,000 |
| Single or head of household | $200,000 |
| Rate | 3.8% |
IRS Topic 559 says “In the case of an individual, the NIIT is 3.8 percent on the lesser of: the net investment income, or the excess of modified adjusted gross income (MAGI) over the following threshold amounts”. The statute, 26 U.S.C. 1411(b), writes the amounts into the law: “in the case of a taxpayer making a joint return under section 6013 or a surviving spouse (as defined in section 2(a)), $250,000” and “in any other case, $200,000”.
A worked example
Take a single filer with $230,000 of modified adjusted gross income and $50,000 of net investment income, both illustrations and not source figures. Income over the threshold is $30,000. That is less than the investment income, so the tax applies to the lesser figure: 3.8% of $30,000 is $1,140 (computed). If the same filer had only $10,000 of investment income, the tax would be 3.8% of that smaller amount instead.
Estates and trusts
Trusts use a different measure. Topic 559 says that for an estate or trust the tax applies to “the undistributed net investment income, or the excess (if any) of: the adjusted gross income over the dollar amount at which the highest tax bracket begins for an estate or trust for the tax year”. See the trust and individual threshold page for the difference.
What can move you across the line
The tax turns on modified adjusted gross income, so anything that raises it can bring more investment income into the tax: a large realized gain, a business sale or a Roth conversion. The conversion itself is not investment income, but it adds to the income measure; see Roth conversions and the NIIT. Timing gains across years is the main planning lever.
Common mistakes
- Applying 3.8% to all investment income. The tax applies to the lesser of investment income or the income over the threshold.
- Using the joint threshold for a separate return. Married filing separately uses $125,000.
- Assuming the thresholds rise with inflation. They are fixed dollar amounts in the statute.
- Forgetting that a Roth conversion can raise the income measure.
Related: the trust and individual NIIT thresholds, Roth conversions and the NIIT, and the 2026 retirement numbers hub.
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Answer againSources
- IRS Tax Topic 559, Net investment income tax: https://www.irs.gov/taxtopics/tc559
- 26 U.S.C. 1411, imposition of tax (U.S. Code text, Cornell Legal Information Institute): https://www.law.cornell.edu/uscode/text/26/1411
Sources: the primary documents linked above, read on October 1, 2026. General information, not tax advice. Your own facts decide the outcome, and a preparer, the plan administrator or the agency itself is the right place to confirm anything consequential.