Despite the widespread use of transcranial alternating current stimulation (tACS) as a non-invasive brain stimulation technique, it remains challenging to study online neural effects of tACS due to stimulation artifacts. Here, we exploit neural nonlinearities to account for artifacts and reveal online neural effects of tACS. First, we provide a linear model that predicts the brain response to tACS. We then show that magnetoencephalography (MEG) measurements during tACS deviate from the predictions of this model. Specifically, we measured brain activity in human subjects either during 10 Hz visual flicker stimulation, during 10 Hz tACS, or during simultaneous visual stimulation and tACS. We found that brain activity during the simultaneous condition deviated from the linear combination of responses to the separate stimulation conditions. Furthermore, this interaction depended on the relative phase of visual stimulation and tACS. Our work provides a new approach to studying the online neural effects of tACS and adds new evidence for an interaction between tACS and ongoing neural activity.