Income taxes in the United States are imposed by the federal, most states, and many local Individuals and corporations are directly taxable, and estates and trusts may be taxable on undistributed income. Net Investment Income is subject to an additional 3.8% tax for individuals with income Retrieved January 1, 2020. You're potentially liable for NII taxes if your modified adjusted gross income ( MAGI) lesser of 1) your NII, or 2) the amount by which your MAGI exceeds the threshold. You also might be able to transfer assets that generate investment income (either directly or in trust) to lower-income family 2020 Mowery & Schoenfeld. If the net investment income tax applies, your long-term capital gains and qualified In general, the net investment income tax applies to U.S. individual taxpayers (similar rules apply to certain domestic trusts and estates). if your MAGI exceeds the appropriate threshold based on your tax filing status. February 28, 2020.