Medicare IRMAA surcharges catch many retirees off guard, arriving as a higher-than-expected premium bill months after they enroll. IRMAA, short for Income-Related Monthly Adjustment Amount, is an extra charge added to Part B and Part D premiums for Medicare beneficiaries whose income exceeds certain thresholds. Because the amount is based on tax return data from two years earlier, a single high-income year, even one caused by a Roth conversion, a home sale, or a large capital gain, can trigger a surcharge long after the income has passed. Understanding how the brackets work, and how to appeal when circumstances change, can help you avoid paying more than necessary.
What Are Medicare IRMAA Surcharges?
Medicare IRMAA surcharges apply to beneficiaries whose modified adjusted gross income (MAGI) rises above set thresholds. The Centers for Medicare & Medicaid Services (CMS) uses your MAGI from two years prior to determine what you pay in the current year, so 2026 premiums are based on the income reported on your 2024 federal tax return. This lookback period means a decision made today about a Roth conversion, a large IRA withdrawal, or the sale of an investment property will not affect your Medicare premium until two years later.
Unlike ordinary income tax brackets, IRMAA works on a cliff basis. Exceeding a threshold by even one dollar moves you into the next surcharge tier for the entire year, so income near a bracket line deserves careful planning.
2026 Medicare IRMAA Brackets
For 2026, the standard Medicare Part B premium is $202.90 per month. Beneficiaries with 2024 MAGI above $109,000 (single filers) or $218,000 (married filing jointly) pay one of five additional tiers on top of that base premium.
| 2024 MAGI (Single) | 2024 MAGI (Married, Joint) | Total Monthly Part B Premium |
|---|---|---|
| $109,000 or less | $218,000 or less | $202.90 (standard, no surcharge) |
| $109,001 – $137,000 | $218,001 – $274,000 | $284.10 |
| $137,001 – $171,000 | $274,001 – $342,000 | $405.80 |
| $171,001 – $205,000 | $342,001 – $410,000 | $527.50 |
| $205,001 – $500,000 | $410,001 – $750,000 | $649.20 |
| Above $500,000 | Above $750,000 | $689.90 |
Part D IRMAA surcharges follow the same income brackets and are added on top of your plan’s regular premium, ranging from roughly $14.50 to $91.00 per month depending on your tier. Because both surcharges are recalculated annually, moving into a lower income year can eventually reduce or eliminate the charge, though only after the two-year lookback catches up.
How Medicare Enrollment Timing Affects Your Premium
IRMAA is separate from, but often discussed alongside, Medicare’s enrollment deadlines. Your Initial Enrollment Period runs for seven months, starting three months before the month you turn 65 and ending three months after. Missing this window can trigger a separate late enrollment penalty: a permanent 10 percent addition to your Part B premium for each 12-month period you delayed, and a Part D penalty based on the national base beneficiary premium for each month you went without creditable drug coverage. Enrolling on time, and understanding whether IRMAA will apply, are both part of a complete Medicare cost picture.
How to Appeal a Medicare IRMAA Surcharge
If your income has dropped since the tax year used to calculate your surcharge, you may be able to reduce or eliminate it by filing Form SSA-44, Medicare Income-Related Monthly Adjustment Amount – Life-Changing Event, with the Social Security Administration. Qualifying life-changing events include:
- Work stoppage or reduction of hours (including retirement)
- Marriage, divorce, or annulment
- Death of a spouse
- Loss of income-producing property due to a disaster or other event beyond your control
- Loss or reduction of pension income
- An employer settlement payment tied to closure or bankruptcy
The Social Security Administration typically processes SSA-44 appeals within 30 to 90 days. If your appeal is approved, any excess IRMAA you already paid is refunded. If your income was miscalculated, or you filed an amended tax return, you can also request a correction directly with the Social Security Administration using your updated tax records rather than the life-changing-event process.
Does an IRMAA appeal apply to me? A quick self-check
You may have grounds to appeal if any of the following is true:
- You retired or reduced work hours after the tax year used to set your current premium.
- You experienced a marriage, divorce, or the death of a spouse that changed your household income.
- The income that triggered your surcharge was a one-time event, such as a Roth conversion, capital gain, or property sale, and your ongoing income is now lower.
- You filed an amended return or the IRS/SSA record contains an error.
If none of these apply, the surcharge is likely calculated correctly and will adjust naturally as your income changes are reflected in a future tax year.
Strategies to Manage Medicare IRMAA Surcharges Over Time
Because IRMAA is based on a two-year-old tax return, the most effective planning happens well before you enroll in Medicare. A few approaches we discuss with clients include:
- Spreading out Roth conversions. Converting traditional IRA assets to a Roth IRA in smaller amounts across several years, rather than all at once, can help keep MAGI below a bracket threshold in any single year.
- Sequencing withdrawals. Coordinating which accounts you draw from first in retirement, taxable, tax-deferred, or Roth, can smooth taxable income from year to year.
- Timing large one-time income events. If you are approaching age 63 (two years before Medicare eligibility at 65), consider whether a property sale, business income event, or large withdrawal can be timed to reduce its effect on future IRMAA brackets.
- Using qualified charitable distributions. For those over 70½ with IRA assets, qualified charitable distributions can satisfy giving goals without increasing MAGI.
These strategies involve tradeoffs with tax brackets, estate planning goals, and cash flow needs, so they work best as part of a coordinated retirement income plan rather than a standalone decision made once a surcharge notice arrives.
Getting Help With Your Medicare and Retirement Income Planning
Medicare IRMAA surcharges are one of many moving pieces in a retirement income plan, alongside Social Security claiming decisions, required minimum distributions, and tax-efficient withdrawal sequencing. We help clients look at these pieces together rather than in isolation, so that a decision made for one goal does not create an unexpected cost somewhere else. If you would like to talk through how IRMAA fits into your broader retirement plan, we invite you to schedule a free 30-minute call.
Rooney Wealth Management LLC is an investment adviser registered with the state of California. This article is for educational purposes only and is not tax, legal, or investment advice. Please consult your tax or financial professional regarding your specific situation.
