What term describes deductions subtracted from gross income to determine adjusted gross income (AGI)?

The term that describes deductions subtracted from gross income to determine adjusted gross income (AGI) is "Above the Line Deductions." These deductions are available regardless of whether a taxpayer itemizes their deductions or claims the standard deduction. They are advantageous because they directly reduce gross income, resulting in a lower AGI, which can potentially affect eligibility for certain tax credits and other deductions that phase out at higher AGI levels.

Above the line deductions include items such as contributions to retirement accounts, student loan interest, educator expenses, and certain business expenses incurred by self-employed individuals. Given their significance in tax calculations, understanding how they function is essential for anyone studying taxation.

The other options, such as below the line deductions, itemized deductions, and standard deductions, refer to deductions taken after calculating AGI and can only be claimed if one decides to itemize instead of taking the standard deduction. These do not affect the determination of AGI directly, which is why they do not fit the definition provided in the question.