IRMAA Update: Key Numbers for High-Income Retirees
Aimee Calderon, CFP®
Many clients have informed us they are receiving their Medicare premium notifications for 2026. We think now is a good time to revisit an article we originally wrote in 2024 and update it with current figures.
IRMAA stands for “income-related Medicare adjustment amount” and is essentially a Medicare surcharge or tax. Social Security uses your tax return to determine how much you should pay for Part B and Part D of Medicare. From the return, your modified adjusted gross income (MAGI) is the figure that determines how much you pay. MAGI is equal to your AGI plus tax-exempt interest or foreign-earned income. IRMAA calculations have a two-year lag time, so your 2026 rates depend on your 2024 tax return.
If your 2024 MAGI is under $109,000 as a single person or $218,000 as a married person, you will pay the baseline amount of $202.90/month for Part B coverage and about $38.99/month for Part D coverage in 2026 (the Part D cost can vary based on your plan). If your MAGI is more than these amounts, you will pay an additional surcharge for these coverages due to IRMAA.
Here are the monthly income brackets and adjustment amounts (which sit on top of the base premiums) for 2026 based on 2024 MAGI:
It is important to note that, unlike income tax brackets that are marginal, IRMAA uses a “cliff”-style assessment. If you are $1 over the cut-off for the next tier, you will pay the higher monthly amount. For example, if you are married and your 2024 MAGI was $275,000, you and your spouse will each pay $202.90 and $37.50 in additional monthly premiums for Part B and Part D, respectively.
If you get pushed into IRMAA, there are some circumstances under which you can appeal the surcharge. You must have a life-changing event to qualify for an appeal. The following are Social Security’s approved life-changing events:
Marriage
Divorce/Annulment
Death of your Spouse
Work Stoppage
Work Reduction
Loss of Income-Producing Property
Employer Settlement Payment
Determination letters from Social Security indicating that you are getting pushed into IRMAA are typically mailed out at the end of the calendar year. If you receive a letter, it is important to consult your financial advisor or accountant to see if you are eligible for an appeal.
To appeal the surcharge, you must complete a Medicare IRMAA Life Changing Event Form SSA-44. You will need to provide documentation of your life-changing event and the decrease in your income. You can estimate your current year’s income for the appeal, but you must eventually submit a tax return to prove the decrease.
The IRMAA surcharges are steep and can be a shock for many taxpayers. It is important to be aware of them, so you don’t inadvertently get pushed off an IRMAA “cliff.” Required minimum distributions and unexpected capital gain distributions can sometimes be the culprits. Tax planning for the current year and future years becomes even more essential when trying to avoid IRMAA.
Schedule a 15-minute discovery call with a fee-only financial advisor if you want help thinking through some of these issues.