[Updated on October 10, 2024 after the release of the inflation number for September 2024. The next update will be on November 13, 2024.]
Seniors 65 or older can sign up for Medicare. The government calls people who receive Medicare beneficiaries. Medicare beneficiaries must pay a premium for Medicare Part B which covers doctors’ services and Medicare Part D which covers prescription drugs. The premiums paid by Medicare beneficiaries cover about 25% of the program costs for Part B and Part D. The government pays the other 75%.
What Is IRMAA?
Medicare imposes surcharges on higher-income beneficiaries. The theory is that higher-income beneficiaries can afford to pay more for their healthcare. Instead of doing a 25:75 split with the government, they must pay a higher share of the program costs.
The surcharge is called IRMAA, which stands for Income-Related Monthly Adjustment Amount. This applies to both Traditional Medicare (Part B and Part D) and Medicare Advantage plans.
According to the Medicare Trustees Report, 7% of Medicare Part B beneficiaries paid IRMAA. The extra premiums they paid lowered the government’s share of the total Part B and Part D expenses by two percentage points. Big deal?
MAGI
The income used to determine IRMAA is your Modified Adjusted Gross Income (MAGI) — which is your AGI plus tax-exempt interest and dividends from muni bonds — from two years ago. Your 2022 MAGI determines your IRMAA in 2024. Your 2023 MAGI determines your IRMAA in 2025. Your 2024 MAGI determines your IRMAA in 2026.
There are many definitions of MAGI for different purposes. The MAGI for subsidies on health insurance from the ACA marketplace includes untaxed Social Security benefits. The MAGI for IRMAA doesn’t include untaxed Social Security benefits. If you read somewhere else that says that untaxed Social Security benefits are included in MAGI, they’re talking about a different MAGI, not the MAGI for IRMAA.
You can use Calculator: How Much of My Social Security Benefits Is Taxable? to calculate the taxable portion of your Social Security benefits.
As if it’s not complicated enough while not moving the needle much, IRMAA is divided into five income brackets. Depending on the income, higher-income beneficiaries pay 35%, 50%, 65%, 80%, or 85% of the program costs instead of 25%. As a result, they pay 1.4 times, 2.0 times, 2.6 times, 3.2 times, or 3.4 times the standard Medicare premium.
The threshold for each bracket can cause a sudden jump in the monthly premium amount you pay. If your income crosses over to the next bracket by $1, all of a sudden your Medicare premiums can jump by over $1,000/year. If you are married filing a joint tax return and both of you are on Medicare, $1 more in income can make the Medicare premiums jump by over $1,000/year for each of you.
* The last bracket on the far right isn’t displayed in the chart.
So if your income is near a bracket cutoff, see if you can manage to keep it down and make it stay in a lower bracket. Using the income from two years ago makes it more difficult to manage.
2024 IRMAA Brackets
The income on your 2022 IRS tax return (filed in 2023) determines the IRMAA you pay in 2024.
Part B Premium | 2024 Coverage (2022 Income) |
---|---|
Standard | Single: <= $103,000 Married Filing Jointly: <= $206,000 Married Filing Separately <= $103,000 |
1.4x Standard | Single: <= $129,000 Married Filing Jointly: <= $258,000 |
2.0x Standard | Single: <= $161,000 Married Filing Jointly: <= $322,000 |
2.6x Standard | Single: <= $193,000 Married Filing Jointly: <= $386,000 |
3.2x Standard | Single: < $500,000 Married Filing Jointly: < $750,000 Married Filing Separately < $397,000 |
3.4x Standard | Single: >= $500,000 Married Filing Jointly: >= $750,000 Married Filing Separately >= $397,000 |
Source: Medicare Costs, Medicare.gov
The standard Part B premium is $174.70 in 2024. Higher-income Medicare beneficiaries also pay a surcharge for Part D. The income brackets are the same. The Part D IRMAA surcharges are relatively smaller in dollars.
2025 IRMAA Brackets
We have all 12 data points now for the IRMAA brackets in 2025 (based on 2023 income). These will be the 2025 numbers when the Medicare website publishes them in a couple of months:
Part B Premium | 2025 Coverage (2023 Income) |
---|---|
Standard | Single: <= $106,000 Married Filing Jointly: <= $212,000 Married Filing Separately <= $106,000 |
1.4x Standard | Single: <= $133,000 Married Filing Jointly: <= $266,000 |
2.0x Standard | Single: <= $167,000 Married Filing Jointly: <= $334,000 |
2.6x Standard | Single: <= $200,000 Married Filing Jointly: <= $400,000 |
3.2x Standard | Single: < $500,000 Married Filing Jointly: < $750,000 Married Filing Separately < $394,000 |
3.4x Standard | Single: >= $500,000 Married Filing Jointly: >= $750,000 Married Filing Separately >= $394,000 |
Source: Author’s calculations.
If you’re married filing separately, you may have noticed that the bracket for 3.2x standard goes down in 2025 compared to 2024. That’s not a typo. If you look up the history of that bracket (under heading C), you’ll see it went down from one year to the next. That’s the law. It puts more people married filing separately with a high income into the 3.4x standard bracket.
Medicare hasn’t announced the standard Part B premium in 2025 yet. The standard Part B premium is $174.70/month in 2024. The change from year to year is usually less than $10/month.
I also have the tax brackets for 2025. Please read 2025 Tax Brackets, Standard Deduction, Capital Gains, etc. if you’re interested.
2026 IRMAA Brackets
We have one data right now out of 12 for the IRMAA brackets in 2026 (based on 2024 income). We can only make some preliminary estimates and plan for some margin to stay clear of the cutoff points.
If annualized inflation from October 2024 through August 2025 is 0% (prices staying flat at the latest level) or 3% (approximately a 0.25% increase every month), these will be the 2026 numbers:
Part B Premium | 2026 Coverage (2024 Income) 0% Inflation | 2026 Coverage (2024 Income) 3% Inflation |
---|---|---|
Standard | Single: <= $108,000 Married Filing Jointly: <= $216,000 Married Filing Separately <= $108,000 | Single: <= $109,000 Married Filing Jointly: <= $218,000 Married Filing Separately <= $109,000 |
1.4x Standard | Single: <= $135,000 Married Filing Jointly: <= $270,000 | Single: <= $137,000 Married Filing Jointly: <= $274,000 |
2.0x Standard | Single: <= $169,000 Married Filing Jointly: <= $338,000 | Single: <= $171,000 Married Filing Jointly: <= $342,000 |
2.6x Standard | Single: <= $202,000 Married Filing Jointly: <= $404,000 | Single: <= $205,000 Married Filing Jointly: <= $410,000 |
3.2x Standard | Single: < $500,000 Married Filing Jointly: < $750,000 Married Filing Separately < $392,000 | Single: < $500,000 Married Filing Jointly: < $750,000 Married Filing Separately < $391,000 |
3.4x Standard | Single: >= $500,000 Married Filing Jointly: >= $750,000 Married Filing Separately >= $392,000 | Single: >= $500,000 Married Filing Jointly: >= $750,000 Married Filing Separately >= $391,000 |
Higher inflation raises the IRMAA brackets in general, except for the 3.2x standard for married filing separately, which puts more people married filing separately with a high income into the 3.4x standard bracket.
Because the formula compares the average of 12 monthly CPI numbers over the average of 12 monthly CPI numbers in a base period, even if prices stay the same in the following months, the average of the next 12 months will still be higher than the average in the previous 12 months.
To use exaggerated numbers, suppose gas prices went up from $3/gallon to $3.50/gallon over the last 12 months. The average gas price in the last 12 numbers was maybe $3.20/gallon. When gas price inflation becomes 0%, it means it stays at the current price of $3.50/gallon. The average for the next 12 months is $3.50/gallon. Brackets based on an average gas price of $3.50/gallon in the next 12 months will be higher than brackets based on an average gas price of $3.20/gallon in the previous 12 months.
If you really want to get into the weeds of the methodology for these calculations, please read this reply on comment page 2 and this other comment on page 4.
Roth Conversion Tools
When you manage your income by doing Roth conversions, you must watch your MAGI carefully to avoid accidentally crossing one of these IRMAA thresholds by a small amount and triggering higher Medicare premiums.
I use two tools to help with calculating how much to convert to Roth. I wrote about these tools in Roth Conversion with TurboTax What-If Worksheet and Roth Conversion with Social Security and Medicare IRMAA.
Nickel and Dime
The standard Medicare Part B premium is $174.70/month in 2024. A 40% surcharge on the Medicare Part B premium is about $840/year per person or about $1,700/year for a married couple both on Medicare.
In the grand scheme, when a couple on Medicare has over $206,000 in income, they’re already paying a large amount in taxes. Does making them pay another $1,700 make that much difference? It’s less than 1% of their income but nickel-and-diming just makes people mad. People caught by surprise when their income crosses over to a higher bracket by just a small amount are angry at the government. Rolling it all into the income tax would be much more effective.
Oh well, if you are on Medicare, watch your income and don’t accidentally cross a line for IRMAA.
IRMAA Appeal
If your income two years ago was higher because you were working at that time and now your income is significantly lower because you retired (“work reduction” or “work stoppage”), you can appeal the IRMAA initial determination. The “life-changing events” that make you eligible for an appeal include:
- Death of spouse
- Marriage
- Divorce or annulment
- Work reduction
- Work stoppage
- Loss of income from income producing property
- Loss or reduction of certain kinds of pension income
You file an appeal with the Social Security Administration by filling out the form SSA-44 to show that although your income was higher two years ago, you had a reduction in income now due to one of the life-changing events above. For more information on the appeal, see Medicare Part B Premium Appeals.
Not Penalized For Life
If your income two years ago was higher and you don’t have a life-changing event that makes you qualify for an appeal, you will pay the higher Medicare premiums for one year. The IRMAA surcharge goes into the Medicare budget. It helps to keep Medicare going for other seniors on Medicare.
IRMAA is re-evaluated every year as your income changes. If your higher income two years ago was due to a one-time event, such as realizing capital gains or taking a large withdrawal from your IRA, when your income comes down in the following year, your IRMAA will also come down automatically. It’s not the end of the world to pay IRMAA for one year.
Say No To Management Fees
If you are paying an advisor a percentage of your assets, you are paying 5-10x too much. Learn how to find an independent advisor, pay for advice, and only the advice.
David Swanson says
Your article says that for 2026 IRMAA brackets (based on 2024 income), will be (for MFJ) $214,000 or $218,000, depending on the 12 month average inflation value. While we don’t know all the inflation data yet, are those IRMAA brackets exact? If not, when will they release the exact IRMAA brackets?
Thanks,
Dave
Jeff Enders says
they are exact (which I take you mean they are rounded to the nearest $1000) because the law requires rounding to the nearest thousand dollars for the SINGLE limit and then doubling it for the MFJ limit……..
Nancy Memmel says
David
2026 brackets would be known near the end of 2025 since August 2025 inflation data is the last data point and that will come out in early Sept 2025.
Not particularly helpful for regulating income realized in 2024 for the purpose of undercutting thresholds for 2026 IRMAA, but it takes time for the income data the SSA uses to assess IRMAA to become available to it, so IRMAA is determined by prior incomes.
Robert Hoppe says
I’m not understanding the huge gaps between IRMAA MAGI brackets (based on 2023 income). The website shows the following:
These will be the 2025 numbers when the Medicare website publishes them in a couple of months:
Part B Premium 2025 Coverage (2023 Income)
Standard:
Single: <= $106,000
Married Filing Jointly: <= $212,000
Married Filing Separately <= $106,000
1.4x Standard Single:
<= $133,000
Married Filing Jointly: <= $266,000
What is the multiple of standard if the year 2025 MFJ MAGI falls between $212,000 and $266,000?
Harry Sit says
It’s 1.4x. The symbol before the number means “less than or equal to.”
Robert Hoppe says
Thanks Harry. I think it would be clearer if the site were to show > $212,000 and < = $266,000 for the MFJ category (i.e., 2023 MAGI for 2025 premiums) rather than just < = $266,000, so that readers can see that the 1.4 X standard category falls in the $212,000+ – $266,000 MAGI range.
Harry Sit says
You read the table from top to bottom and you stop at the first row your income falls in.
Frustrated by IRMAA says
Hi Harry,
Any chance you may revise 2026 IRMAA brackets based on 2024 income within the next two months. Thanks!
Jeff Enders says
the ranges are revised monthly based on new inflation data. so the answer to your question, is ‘yes’. But your further question may be will the ranges change? that depends on the actual inflation reported and its impact on the underlying calculations.
Harry Sit says
I follow the CPI release dates. The next update date is shown at the very top of this post. The last update in 2024 will be on December 11. The brackets may or may not change in each update depending on the data.
The Wizard says
Frustrated,
Harry tends to update his IRMAA projections monthly based on actual inflation data plus a few projected future inflation scenarios.
This allows folks to compute a safe Roth conversion amount each December, on top of other income, to stay in their chosen IRMAA tier two years hence…
Paul says
Harry as already posted the next CPI-U release date. The future schedule is here:
https://www.bls.gov/schedule/news_release/cpi.htm
I will also note the IRMAA brackets are calculated from the average CPI from September to August. To calculate IRMAA for any given tax year, the final monthly CPI you need will be published in September of the following year.
While this is really inconvenient for tax planning, the reason IRMAA “looks back” so far: your final version of your tax return isn’t due until October of the following year. Of course, if the legislation had specified IRMAA brackets to be set based on the CPI increase in the previous year, it would have been a lot easier.
Mary says
Just to be safe I usually try to keep income below the previous year’s IRMAA amount . A safety measure just in case something unexpected happens.
What I’m wondering now is what will happen to the amount when/if the TCJA goes away? Will the IRMAA revert back to 170k or less?
GeezerGeek says
Mary,
Brief History of IRMAA: Was first implemented as part of the Medicare Modernization Act of 2003 and was initiated in 2007. The brackets were initially lower but were indexed to increase so that only about 5% of enrollees would pay the penalty. For joint returns, the maximum income without a IRMAA penalty was $160,000 for 2007, $164,000 for 2008, and $170,000 for 2009 & 2010 (no price inflation for 2010). The ACA (Affordable Care Act) froze the brackets at the 2010 level where they remained until 2020 when the brackets were again indexed to increase based on inflation. In 2018, the income for the top bracket was dropped to the previous next lower bracket and a new middle bracket was inserted. In 2019 an additonal higher bracket for income $750k and above was added. Initially, the IRMAA only applied to Part B premiums but in 2011, the Affordable Care Act extended IRMAA to also include Part D premiums.
So, as Robert Hoppe pointed out, nothing in the TCJA changed the IRMAA brackets.
Audrey says
Was there supposed to be an update to this article on Oct 10 after the September 2024 CPI report? I really appreciate these forecasts for 2026.
Audrey says
Never mind. For some reason I kept getting a link to the stale version of this article from any web search and didn’t see the October comments even until I posted my own. Weird. Thanks!
Robert Hoppe says
Hi Mary. I don’t see how an expiration of the TCJA could possibly have any impact on the MAGI IRMAA thresholds. The MAGI IRMAA thresholds will have the same effect on Medicare Part B premiums regardless of the IRS income tax laws. The MAGI IRMAA thresholds are determined by Medicare, not the IRS. BTW – I have been taking the same approach as you with respect to keeping our MAGI for the current tax year at the same level as the MAGI IRMAA thresholds from 2023, just in case Medicare decides not to increase the IRMAA thresholds for 2024.
Mary says
Thanks Robert. It’s reassuring to hear that the IRMAA magi will not be reduced.