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Waveguide structures of the stand-alone electroabsorption (EA) modulator and the electroabsorption modulated laser (EML) are investigated using the 3D beam propagation method. The EA waveguide structures with InP-based passivation layers show saturation in the extinction ratio (ER) due to the stray light traveling through the passivation layers. This paper demonstrates that narrower passivation layers suppress stray-light excitation in the EA waveguide, increasing the ER. A taper structure in the isolation section of the EML waveguide can reduce the mode mismatch and suppress the excitation of the stray light, increasing the ER further. Low-index-polymer passivation layers can confine the mode more tightly in the active waveguide, yielding an even higher ER.