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• • • MAGI: Tax-Exempt Interest 97 Tax-Exempt Interest Most interest people receive from bank accounts, money market accounts, certificates of deposit, and deposited insurance dividends is considered taxable income and is already included as part of adjusted gross income. However, interest on some bonds issued by and used to finance state and local government operations is not taxable at the federal level. This tax-exempt interest is considered as part of MAGI. The application will not ask about this income separately—it is expected that individuals include it with their other interest when requested. 3 Comparing Results to Eligibility Levels Determining Household Income Constructing a Household Purpose