Disclosure: PortfolioPilot is a technology product of Global Predictions Inc, a Registered Investment Advisor. You must subscribe to receive personalized investment advice.

Tools

NIIT Exposure Calculator (3.8%) - Tool

Alexander Harmsen

Alexander Harmsen is the Co-founder and CEO of PortfolioPilot. With a track record of building AI-driven products that have scaled globally, he brings deep expertise in finance, technology, and strategy to create content that is both data-driven and actionable.

Reviewed by

PortfolioPilot Compliance Team

The PortfolioPilot Compliance Team reviews all content for factual accuracy and adherence to SEC marketing rules, ensuring every piece meets the highest standards of transparency and compliance.

NIIT Exposure Calculator (3.8%)

This tool shows whether you’re exposed to the Net Investment Income Tax (NIIT) and, if so, estimates the tax due. NIIT applies 3.8% to the lesser of (i) your Net Investment Income (NII) or (ii) the amount your MAGI exceeds your filing-status threshold.

Exposure?

—

Based on MAGI vs threshold

Excess over threshold (max base)

—

Upper bound for NIIT base

Subject to NIIT (actual base)

—

= min(NII, excess)

Estimated NIIT tax (3.8%)

—

Applies only if base > 0

Detail

Item	Value
Estimated NIIT (3.8%)	—

Thresholds (not indexed): Single/HOH: $200,000 · MFJ: $250,000 · MFS: $125,000. NIIT applies to the lesser of NII or the MAGI excess above the threshold. NII heuristic: when NII is not provided, we estimate NII ≈ taxable portfolio × expected return. This is an approximation — confirm with your actual tax records.

What the NIIT Exposure Calculator does

The tool is built to answer two practical questions:

“Am I exposed to NIIT this year?”
“If so, what’s a ballpark estimate of the tax?”

It follows the IRS rule that NIIT equals 3.8% × min( NII, MAGI – threshold ) (IRS, Pub. 8960). That “lesser-of” rule matters; even with high MAGI, NIIT is capped by the amount of net investment income.

So what? Knowing whether NIIT is in play can help an investor avoid surprises when projecting cash needs for estimated taxes or year-end withholding.

Key Takeaways

The calculator checks if NIIT applies and estimates the tax base as the lesser of (i) Net Investment Income (NII) or (ii) MAGI over the threshold - then multiplies by 3.8% (IRS, Pub. 8960).
Users can enter NII directly (interest, dividends, realized gains, passive income) or estimate it from a taxable portfolio and expected return.
The dashboard shows exposure status, upper bound, actual NIIT base, and estimated NIIT dollars, plus a detail table that documents the math.
It’s an educational estimator, not tax advice, and excludes state taxes and other surtaxes. Values depend on each filer’s records.

Inputs (and why each matters)

Left-hand inputs mirror the IRS definition while keeping things simple:

Filing status - sets the threshold (e.g., $250,000 for MFJ).
MAGI - the IRS uses modified AGI, which can differ from “AGI” on a pay stub. The tool uses the number the user enters.
Option A - Enter NII directly - total of interest, dividends, realized capital gains, passive income for the year.
Option B - Estimate NII from a taxable portfolio - if the NII field is blank, the tool estimates NII ≈ taxable portfolio × expected return (simple heuristic for education).
Check NIIT - computes exposure and displays:
- Excess over threshold (upper bound),
- NIIT base (the actual lesser-of amount), and
- Estimated NIIT dollars (3.8% of base).

The Detail panel restates every assumption, which makes review and documentation easier.

How to use it (step-by-step)

Choose filing status (e.g., Married filing jointly).
Enter expected MAGI for the year.
Set Option A by entering known NII, or leave it blank and use Option B to estimate from a taxable portfolio plus an expected annual return.
Click Check NIIT.
Read the top-row tiles: Exposure (Yes/No), Excess over threshold, Subject to NIIT (actual base), and Estimated NIIT (3.8%).
Use the Detail table to confirm how the base was computed.

What shows on the screen (and how to read it)

Exposure? - “Yes/No” with the applicable threshold for the filing status.
Excess over threshold - the upper bound for the NIIT base.
Subject to NIIT (actual base) - the lesser-of number used for tax.
Estimated NIIT (3.8%) - dollars potentially due.
Detail table - the paper trail: filing status, MAGI, threshold, excess, NII (entered or estimated), and the final base.

This interactive analysis tool uses user-entered assumptions to illustrate potential NIIT exposure under the 3.8% Medicare surtax. Results are hypothetical, educational, and not tax, legal, or investment advice. The calculator applies simplified annual formulas based on your inputs (filing status thresholds, MAGI, and net investment income). It does not account for all NIIT definitions or adjustments (e.g., foreign income add-backs to MAGI, passive/non-passive grouping, netting rules, deductions, credits, loss carryforwards, estates/trusts rules, or state taxes), and tax laws may change. Actual outcomes depend on your records and circumstances. Results will change if inputs change.

How optimized is your portfolio?

PortfolioPilot is used by over 30,000 individuals in the US & Canada to analyze their portfolios of over $30 billion¹. Discover your portfolio score now:

1: As of February 20, 2025

Global Predictions provides investment advice only through its internet-based application, PortfolioPilot, and only to individuals who are advisory clients of Global Predictions pursuant to written advisory Client Agreements ("Advisory Services"). The publicly available portions of the Platform (i.e., the sections of the Platform that are available to individuals who are not party to a Client Agreement - including globalpredictions.com and portions of portfoliopilot.com) are provided for educational purposes only and are not intended to provide legal, tax, or financial planning advice. To the extent that any of the content published on publicly available portions of the Platform may be deemed to be investment advice, such information is impersonal and not tailored to the investment needs of any specific person. Nothing on the publicly available portions of the Platform should be construed as a solicitation or offer, or recommendation, to buy or sell any security. All charts, figures, and graphs on the publicly available websites are for illustrative purposes only. Before investing, you should consider whether any investment, investment strategy, security, other asset, or related transaction is appropriate for you based on your personal investment objectives, financial circumstances, and risk tolerance. You are also encouraged to consult your legal, tax, or investment professional regarding your specific situation. Registration does not imply a certain level of skill or training. Investing involves risk. The value of your investment will fluctuate, and you may gain or lose money.

The contents of the Platform may contain forward-looking statements that are based on management's beliefs, assumptions, current expectations, estimates, and projections about the financial industry, the economy, or Global Predictions itself. Forward-looking statements are not guarantees of the underlying expected actions or future performance and future results may differ significantly from those anticipated by the forward-looking statements. Therefore, actual results and outcomes may materially differ from what may be expressed or forecasted in such forward-looking statements.

Note: our use of the term AI refers to all artificial intelligence models used including large language models, proprietary economic models that incorporate regression or dynamic factors, and machine learning methods like supervised learning.

1. As of February 20, 2025
‍
2. As of February 20, 2025
‍
3. $30B Assets on Platform as of February 20, 2025. Aggregated across all plans (including the free plan). Assets on Platform represent the total value of connected and manually inputted accounts (including assets like real estate and private equity) and does not in any way represent Asset Under Management as Global Predictions does not manage any client funds.

4. Global Predictions Secures a Winning Spot in Internacional M6 Financial Forecasting Competition

5. Comparison made to an individual with $1M AUM, paying an "average wealth manager fee" of 1.02% based on a 2023 study by AdvisoryHQ. 1.02% * 1M = $10,200 per annum. PortfolioPilot Annual Gold pricing is $20/mo * 12mo = $240 per annum. 240/10,200 – 1 = ~98% lower. Actual fees paid to any individual financial advisor will depend on specific financial circumstances and arrangements.

7. The 1.94% referenced figure represents the average calculated monthly continuous tax-loss harvesting gain over a 4-year period from 2018-2021 in the 2024-published JP Morgan report titled "Continuous tax-loss harvesting yields more potential for tax savings" (link).

8. Case studies presented are hypothetical scenarios and intended for illustrative purposes only. They do not represent an actual client, investment or experience, but rather are meant to provide an example of the intended investment process and methodology. An individual's experience may vary based on his or her circumstances. There can be no assurance that the Firm will be able to achieve similar results in comparable situations. No portion of this case study is to be interpreted as a testimonial or endorsement of the Firm's investment advisory services. The information contained herein should not be construed as personal investment advice.

9. The financial advisor described in this marketing language is referring to you, the reader. PortfolioPilot is meant to be an aid to the self-directed investor. "Complete financial advice" refers to the fact that PortfolioPilot includes estate planning, tax optimization, net worth visualization, and scenario modeling, not just investment recommendations. See globalpredictions.com/disclosures for descriptions of conflicts of interest, use of AI, bias, and any other disclosures for Global Predictions Inc.

10. This analysis is based on data from publicly available reports, academic studies, and articles. Sources include Mullainathan et al. (2012): Study highlighting biases in financial advice and its misalignment with client interests; Morningstar (2024): Report on typical update frequencies from financial advisors; Bodnaruk and Simonov (2014): Research on the limited impact of financial expertise on investment outcomes; Financhill: Insights on hidden fees in financial advising, including expense ratios and transaction costs, as noted by Warren Buffett; Foerster et al. (2014): Study on the costs of financial advice, including average AUM fees of 2.43%.

11. $11M number calculated as 2024 YTD TLH savings study conducted across 24,000 PortfolioPilot users on November 18, 2024.

12. Based on assumptions and projections that may not reflect actual outcomes.

NIIT Exposure Calculator (3.8%) - Tool