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Form 8960: Net Investment Income Tax—Individuals, Estates, and Trusts
IRS Form 8960 is used to figure the amount of Net Investment Income Tax (NIIT) for Individuals, Estates, and Trusts. This form applies if your modified adjusted gross income (MAGI) is greater than the applicable threshold amount.
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IRS Form 8960 - Net Investment Income Tax—Individuals, Estates, and Trusts
IRS Form 8960 is used to figure the amount of Net Investment Income Tax (NIIT) for Individuals, Estates, and Trusts. This form applies if your modified adjusted gross income (MAGI) is greater than the applicable threshold amount.
Risk Radar
Scan points- 1Ensure you correctly subtract Part II (Total deductions/modifications) from Part I (Total investment income) to find your NIIT.
- 2Failing to include taxable interest from Form 1040 or 1040-SR on Line 1 of Part I.
- 3Incorrectly entering a negative amount for investment interest expenses on Line 2(i) if the sum is not greater than zero.
- 4For ESBTs with S and non-S portions, forgetting to add undistributed NII of the S portion to Line 7.
- 5Not correctly calculating Part I total by combining lines 1, 2, 3, 4c, 5d, 6, and 7 on Line 8.
Plain English
This form calculates the extra tax you owe on money earned from investments, which is called the Net Investment Income Tax (NIIT). You use it to determine how much of that special investment income tax must be added to your overall federal tax bill. If you are an Estate or Trust, this form helps calculate your NIIT as well.
Submission Date
- Filing date: 2026-02-06 08:10:36
- Preparation window: collect IDs, supporting records, and signatures in advance.
- Final review: verify names, dates, and required fields before submission.
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What this form is for
- Use this form when your modified adjusted gross income (MAGI) is greater than the applicable threshold amount, as determined by the IRS.
- Do not use it when you are not subject to Net Investment Income Tax (NIIT), which Form 8960 calculates.
- Check Form 1040-NR instead when filing as a nonresident on the last day of the tax year.
Form selector
Use this form or another form?
Filing jointly with non-resident spouse
You elect to file jointly under these specific sections and wish to apply the joint return election for NIIT purposes.
✓ Check Form 8960, Part I
ESBT has S portion + Non-S portion
Complete lines 1–11 using items from the non-S portion, then add undistributed NII of the S portion to line 7.
✓ Check Instructions p.3
Nonresident filing (but resident part exists)
You need a statement showing income for the part of the year you were a U.S. resident, and these forms serve as the primary statements.
✓ Check Instructions p.2
Deadline or filing window
Form 8960 must be attached to the relevant tax return when filing. The instructions do not specify a fixed deadline date, but it applies if your MAGI exceeds the threshold amount for that year. No specific extension rules are detailed in this excerpt.
Checklist
What you need before filling it out
Taxable interest
Amount reported on Form 8960, Line 1 · Part I
Ordinary dividends
Amount reported on Form 8960, Line 2 · Part I
Annuities
Amount reported on Form 8960, Line 3 · Part I
Rental real estate, etc.
Total amount reported on Form 8960, Line 4 · Part I
CFC Definition
More than 50% voting power or stock value owned by U.S. shareholders · Instructions p.1
Excluded Income
Income excluded from gross income in Chapter 1, or not included in NII · Instructions p.1
Before you submit
- 1Ensure you have attached Form 8960 to your tax return.
- 2Confirm that the Name(s) listed on Form 8960 match those on your tax return.
- 3Verify that your Social Security Number or EIN is correctly entered in Part I.
- 4If applicable, confirm the Section 6013(g) election box is checked/completed.
- 5If applicable, confirm the Section 6013(h) election box is checked/completed.
- 6If applicable, verify the Regulations section 1.1411-10(g) election box is checked/completed.
- 7Ensure all income types (Interest, Dividends, Annuities, etc.) are totaled and reported on Part I.
How to file this form
- 1Determine the required elections by checking boxes for Section 6013(g), Section 6013(h), or Regulations section 1.1411-10(g) on Form 8960.
- 2Report all net investment income amounts—including taxable interest, ordinary dividends, annuities, and other sources—onto Part I of Form 8960.
- 3If an ESBT has both S and non-S portions, use the worksheet to calculate line 7 (undistributed NII) and line 19a before entering them onto Form 8960.
- 4Attach the completed Form 8960 to your tax return, ensuring you include a statement detailing income for prior years if necessary.
Known limitations
- 1The Net Investment Income Tax (NIIT) does not apply to trusts that are exempt from income taxes imposed by subtitle A of the Internal Revenue Code.
- 2Specifically, charitable remainder trusts exempt from tax under section 664 are not subject to NIIT.
- 3Charitable trusts and qualified retirement plan trusts exempt from tax under section 501 are not subject to NIIT.
Field map
Compact field-by-field guide
Entity Info
1 items
Name and taxpayer ID of the entity claiming the credit.
Credit Info
1 items
Type of credit or incentive being claimed.
Calculation
2 items
The base amount used to calculate the credit.
Calculated credit amount after applying formulas and limitations.
Certification
1 items
Detailed breakdown supporting the credit calculation.
Signatures
1 items
Sign and date the form.
Almost done reviewing the fields?
Fillable formOpen in Editor->The current edition is 20/25. Instructions direct users to IRS.gov/Form8960 for the latest information regarding Form 8960 and its instructions.
What changed or needs a fresh check
- Edition date — confirm the revision reads 20/25.
- IRS Form Number — confirm it reads 8960.
- OMB No. — confirm it reads 1545-2227.
- Attachment Sequence No. — confirm it reads 72.
Quick Facts
Downloads
After you file
- 1Keep a copy of the filed IRS Form 8960.
- 2If you were a nonresident on the last day of the tax year, file Form 1040-NR and attach a statement showing your income for the part of the year you were a U.S. resident.
- 3When calculating line 2(i) on Form 8960, enter the lesser of (i)(1) or (i)(2) as a negative amount.
- 4The instructions are based mostly on Regulations sections 1.1411-1 through 1.1411-10.
Sources
- SRCInstructions p.1 — Form 8960 is used to figure the amount of Net Investment Income Tax (NIIT).
- SRCInstructions p.1 — You must attach Form 8960 if your modified adjusted gross income (MAGI) is greater than the applicable threshold amount.
- SRCInstructions p.3 — The applicable threshold amount is determined by checking the instructions for Form 1041, Schedule G, line 1a, and Form 1041-QFT, line 12.
- SRCInstructions p.1 — NII includes net gain attributable to disposition of property not held in a trade/business that isn't passive or trading in financial instruments/commodities.
- SRCInstructions p.3 — Trusts exempt from NIIT include charitable trusts and qualified retirement plan trusts exempt under section 501, and charitable remainder trusts exempt under section 664.
- SRCInstructions p.8 — Line 4b of Form 8960 can be used to adjust for certain types of nonpassive rental income or loss derived in a section 162 trade or business.
Common confusion points
Who must file Form 8960?
File if your modified adjusted gross income (MAGI) is greater than the applicable threshold amount.
What is the 'applicable threshold amount'?
It is the dollar amount at which the highest tax bracket in section 1(e) begins for the tax year. Check instructions for Form 1041, Schedule G, line 1a, or Form 1041-QFT, line 12.
How do I calculate NII?
Net Investment Income (NII) is calculated by taking net gain attributable to dispositions of property (not in a trade/business that isn't passive) and reducing it by allocable deductions.
What happens if the sum on lines 2(a)–2(h) + line 3(d) is zero or less?
Enter -0- on line 2(i) and proceed to calculate line 2(j).
Can I use Form 1040, 1040-NR, or 1040-SR as the statement?
Yes; you can use Form 1040, Form 1040-NR, or Form 1040-SR as the statement.
What is a CFC?
Generally, it is any foreign corporation if more than 50% of its voting power or stock value is owned by U.S. shareholders (or considered owned). Certain insurance companies are CFCs if over 25% is owned.
Workflow map
Related forms and next steps
Before
Current
After
Often used with
⚠ If something goes wrong
- Use instructions for Form 1041, Schedule G, line 1a and Form 1041-QFT, line 12 for specific threshold amount details.
Questions about IRS Form 8960
What is IRS Form 8960 used for?
This form calculates the extra tax you owe on money earned from investments, which is called the Net Investment Income Tax (NIIT). You use it to determine how much of that special investment income tax must be added to your overall federal tax bill. If you are an Estate or Trust, this form helps calculate your NIIT as well.
Who must file IRS Form 8960?
Individuals, Estates, and Trusts must attach Form 8960 to their return if their modified adjusted gross income (MAGI) is greater than the applicable threshold amount.
What information does IRS Form 8960 require?
Part I collects information on investment income elections, such as taxable interest. Part II details the expenses allocable to investment income and modifications. Part III computes the final Net Investment Income Tax by subtracting Part II's total from Part I's total investment income.
When is IRS Form 8960 due?
The instructions do not specify a filing deadline date or period; rather, it requires attachment to your tax return when filing for the relevant tax year.
Where do I file IRS Form 8960?
The official source does not specify a particular service center address for mailing Form 8960. It directs filers to use IRS.gov/Form8960 for the latest information regarding digital assets and general developments.
How do I complete IRS Form 8960?
First, complete Part I by entering details like taxable interest (from Form 1040 or 1040-SR, line 2b). Next, fill out Part II by listing investment expenses and modifications. Finally, calculate the Net Investment Income in Part III by subtracting Part II's total from Part I's total investment income.
What happens if IRS Form 8960 is filed incorrectly?
While specific penalties are not listed, failure to correctly compute the NIIT on Form 8960 means that the tax imposed under section 1411(a) may be incorrectly calculated or omitted from your return.
Who must file Form 8960?
File if your modified adjusted gross income (MAGI) is greater than the applicable threshold amount.
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