What to know if you get an IRMAA letter this year.
Photo by National Cancer Institute on Unsplash
If you are a higher-income taxpayer enrolled in Medicare, you may receive a letter from the Social Security Administration (SSA) this fall. This notice concerns the Income-Related Monthly Adjustment Amount (IRMAA) — an additional premium charged on Medicare Parts B and D for individuals with higher income levels.
Let’s break down what it means, how it’s calculated, and what you can do if you’re affected.
What income is used to determine IRMAA?
IRMAA is based on your Modified Adjusted Gross Income (MAGI), which includes:
- Wages, pensions, and Social Security benefits
- Investment income: interest, dividends, and capital gains
- Including gains from a home sale that do not qualify for or surpass the exclusion
- Rental income
- Tax-exempt interest (like municipal bonds)
- Distributions from retirement accounts (like 401(k)s and IRAs)
- Including Roth conversions
When does it take effect?
The additional IRMAA premiums are based on your income from two years prior. For example, the premiums you pay in 2026 are determined by the income reported on your 2024 tax return. The two-year delay exists because the IRS doesn’t have your official income information until after you file your taxes the following year. Instead of retroactively billing you, Medicare applies the adjusted premiums starting in the next calendar year once your income data is available.
How long does IRMAA last?
IRMAA is evaluated on an annual basis. If the reason for your high income that year is not repeated in subsequent years, it may decrease or go away after one year.
How much will I be charged?
Below are the projected 2026 IRMAA brackets for Medicare Parts B and D:
| Medicare Part B/D Premiums for 2026 | |||
| MAGI Threshold* | Part B Premium | Part D Premium | |
| Single | Married Filing Jointly | ||
| $0 to $109,000 | $0 to $218,000 | $206.50 | Your Plan Premium |
| $109,000 to $137,000 | $218,000 to $274,000 | $206.50 + $82.60 = $289.10 | Your Plan Premium + $14.50 |
| $137,000 to $171,000 | $274,000 to $342,000 | $206.50 + $206.50 = $413.00 | Your Plan Premium + $37.50 |
| $171,000 to $205,000 | $342,000 to $410,000 | $206.50 + $330.40 = $536.90 | Your Plan Premium + $57.00 |
| $205,000 to $500,000 | $410,000 to $750,000 | $206.50 + $454.30 = $660.80 | Your Plan Premium + $78.60 |
| $500,000 and above | $750,000 and above | $206.50 + $495.60 = $702.10 | Your Plan Premium + $85.80 |
*Income thresholds are indexed for inflation and typically increase slightly each year.
How do I know if I’ll be affected?
The Social Security Administration mails IRMAA determination letters in November informing you that the Medicare premium increase will start in January. You will not owe IRMAA for the upcoming year if you do not receive a letter.
How is it paid?
The premiums will come directly from Social Security (if you are receiving a benefit) or be included on the bill with your standard Medicare premiums.
Can I do anything about it?
If you have experienced a life change or believe the IRMAA calculation was erroneous, you can appeal for a redetermination. Acceptable “life-changing events” include:
- Retirement or reduced work hours
- Marriage or divorce
- Death of a spouse
- Loss of income-producing property
- Loss of pension income
If you would like to appeal, you must submit Form SSA-44 and provide documentation supporting your income reduction within 60 days of receiving the IRMAA notice. The linked form is for 2024; 2025 has not yet been published.
Why IRMAA Planning Matters
Understanding IRMAA is essential for retirement and tax planning, especially if you’re considering actions that increase taxable income—like Roth conversions or asset sales. Proactive planning may help you manage or avoid unnecessary surcharges.
Navigating Medicare costs can be complex, but you don’t have to do it alone. If you’ve received an IRMAA letter or want to understand how future income decisions could affect your premiums, we’re here to guide you.
Contact us to discuss your situation and develop a strategy aligned with your long-term financial goals.
