[Updated on July 15, 2025, after the release of the inflation number for June 2025. The next update will be on August 12, 2025.]
Seniors 65 or older can sign up for Medicare. The government refers to people who receive Medicare as “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 remaining 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 2023 MAGI determines your IRMAA in 2025. Your 2024 MAGI determines your IRMAA in 2026. Your 2025 MAGI determines your IRMAA in 2027.
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. The new 2025 Trump tax law didn’t change how Social Security is taxed. It didn’t change anything related to the MAGI for IRMAA. See Social Security Is Still Taxed Under the New 2025 Trump Tax Law.
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 per 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.
2025 IRMAA Brackets
The income on your 2023 IRS tax return (filed in 2024) determines the IRMAA you pay in 2025.
| 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: Medicare Costs, Medicare.gov
The standard Part B premium is $185/month in 2025. 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.
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 ten data points right now out of the 12 needed for the IRMAA brackets in 2026 (based on 2024 income).
If annualized inflation from July 2025 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: <= $109,000 Married Filing Jointly: <= $218,000 Married Filing Separately <= $109,000 | Single: <= $109,000 Married Filing Jointly: <= $218,000 Married Filing Separately <= $109,000 |
| 1.4x Standard | Single: <= $137,000 Married Filing Jointly: <= $274,000 | Single: <= $137,000 Married Filing Jointly: <= $274,000 |
| 2.0x Standard | Single: <= $171,000 Married Filing Jointly: <= $342,000 | Single: <= $171,000 Married Filing Jointly: <= $342,000 |
| 2.6x Standard | Single: <= $205,000 Married Filing Jointly: <= $410,000 | Single: <= $205,000 Married Filing Jointly: <= $410,000 |
| 3.2x Standard | Single: < $500,000 Married Filing Jointly: < $750,000 Married Filing Separately < $391,000 | 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 >= $391,000 | Single: >= $500,000 Married Filing Jointly: >= $750,000 Married Filing Separately >= $391,000 |
The projected 2026 IRMAA brackets are the same under 0% and 3% inflation in the next two months because of rounding. The numbers are different before rounding but the difference disappears after rounding.
If you’re married filing separately, you may have noticed that the bracket for 3.2x goes down with inflation. 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 bracket.
2027 IRMAA Brackets
We have no data point right now out of the 12 needed for the IRMAA brackets in 2027 (based on 2025 income). We can only make preliminary estimates and plan for some margin to stay clear of the cutoff points.
If annualized inflation from July 2025 through August 2026 is 0% (prices staying flat at the latest level) or 3% (approximately a 0.25% increase every month), these will be the 2027 numbers:
| Part B Premium | 2027 Coverage (2025 Income) 0% Inflation | 2027 Coverage (2025 Income) 3% Inflation |
|---|---|---|
| Standard | Single: <= $110,000 Married Filing Jointly: <= $220,000 Married Filing Separately <= $110,000 | Single: <= $112,000 Married Filing Jointly: <= $224,000 Married Filing Separately <= $112,000 |
| 1.4x Standard | Single: <= $138,000 Married Filing Jointly: <= $276,000 | Single: <= $141,000 Married Filing Jointly: <= $282,000 |
| 2.0x Standard | Single: <= $173,000 Married Filing Jointly: <= $346,000 | Single: <= $176,000 Married Filing Jointly: <= $352,000 |
| 2.6x Standard | Single: <= $207,000 Married Filing Jointly: <= $414,000 | Single: <= $211,000 Married Filing Jointly: <= $422,000 |
| 3.2x Standard | Single: < $500,000 Married Filing Jointly: < $750,000 Married Filing Separately < $390,000 | Single: < $500,000 Married Filing Jointly: < $750,000 Married Filing Separately < $388,000 |
| 3.4x Standard | Single: >= $500,000 Married Filing Jointly: >= $750,000 Married Filing Separately >= $390,000 | Single: >= $500,000 Married Filing Jointly: >= $750,000 Married Filing Separately >= $388,000 |
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 $185/month in 2025. A 40% surcharge on the Medicare Part B premium is $888/year per person or $1,776/year for a married couple both on Medicare.
In the grand scheme, when a couple on Medicare has over $212,000 in income, they’re already paying a large amount in taxes. Does making them pay another $1,776 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 have 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, your IRMAA will come down automatically when your income comes down in the following year. It’s not the end of the world to pay IRMAA for one year.
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Robert Hoppe says
Great job Harry and Jeff on the Temporary Senior Deduction section of the Financial Bluff. Very helpful! When I saw the SSA email the other day stating discontinuance of federal income tax on Social Security benefits under the BBB, I immediately sent a reply to the SSA Press office to let them know they are incorrect and I explained the background on that topic. Since the Republican Party in the House voted for a 50% (vs 60%) majority vote to pass the BBB, this meant that income taxation cannot be part of the bill in relation to Social Security. This is why Congress came up with the Temporary Senior Deduction concept to help compensate seniors for all these years in which we paid income tax on Social Security benefits.
Jeff Enders says
Robert – thx for the ‘shout out’ and just an FYI….. the income tax collected that is related to SS goes to the Medicare and SS Trust funds and NOT to the general treasury fund. Any attempt to reduce the tax on this line item just accelerates the challenges of keeping both benefits funded. That was another reason why Congress went for this new deduction versus a direct reduction of what portion of SS is subject to tax.
Further, the rationale is the SS income that is subject to tax now was never taxed in the past. It’s the interest that was generated on the investment of the funds over time. Yes, we were taxed on our paychecks so our FICA contributions were aftertax monies, but we are (theoreticially) not being taxed a second time on the same dollar.
Patrick says
Jeff,
But I didn’t know Harry’s site existed in 2024. In any case, it is ridiculous and unfair for the government to force seniors to fool around with their income because of some very poorly designed “cliff tax” or as I call it, a step function tax. Surely we must all agree that the IRMAA tax should be graduated, like the IRS does it, generally in $50 increments, and not IRMAA’s $28,000 (and more) increments. Furthermore, rounding the thresholds to the nearest $1000 is incredibly lame. The Medicare Modernization Act (which includes IRMAA) was introduced in the House of Representatives on June 25, 2003, and sponsored by Speaker Dennis Hastert, who admitted he was a child molester and who was also found guilty of a structuring charge (a felony). Not surprised.
Henry Waldron says
Be careful what you wish for. In our current financial situation, where politicians are doing everything possible to reduce the deficits implicit in the new “Big, Beautiful Bill”, you may find your wish fulfilled, but with Medicare costs ramping up from a much lower level of income. As it stands very few Social Security recipients pay any IRMAA surcharge, so the fact it is a consideration (for you) puts you in a rarefied income situation. And all of us are paying a steep discount to what Medicare actually incurs. Most retirees, unlike us, have little or no flexibility in terms of income recognition in a given year. The 35% of Social Security recipients who already don’t pay any income taxes will be heavily penalized by the new tax structures, especially if monthly payments drop sooner and by more than currently projected. I can at least construct a financial vehicle from taxes saved to construct an annuity that will defer the effect of any 2033 (or 2034) loss in Social Security income until closer to 2040.
Jeff Enders says
Patrick – Henry stated it best. Nothing more to add.
Patrick says
Henry, Jeff,
I don’t so much object to the IRMAA tax per se, but I object strongly to the way it has been implemented. BTW, I do not worry about Social Security going bust after 2034, or decreasing benefits for those already getting them. It is easy enough for the government to raise the payroll tax, and also end the upper limit of Social Security tax which is currently at $176,000. Ending tax on all Social Security income also would provide more income for those who currently pay federal tax on Social Security income. The threshold below which you do not pay such a tax has not changed since the mid-1970s. It should at least have gone up by the cost of living! BTW, my financial situation has no bearing on my arguments or suggestions. I do not try to guess your incomes, nor do I care what they are.
tom says
I agree. One of the problems with IRMAA is that if much of your income
Is from IRA distributions, or capital gains, you are just guessing as to how much to take, because, for example, you don’t know exactly what the brackets will be in 2027 for tax year 2025, due to inflation adjustments, which you don’t find out about until 2027.
So if you miscalculate and take just a small amount more than what is optimal, then you run the risk of going over into the next IRMAA bracket, triggering a big increase in monthly premiums. I have had that experience more than once.
Mike F says
Thanks to Harry Sit for his insights! The Big Beautiful Bill has been passed into law now. Does that change any of the IRMAA brackets in the tables above?
Jeff Enders says
@Mike F – it does not.
IRMAA brackets are predicated on AGI (Line 11) and Tax Exempt Interest (Line 2a) of the tax return.
Neither line is impacted by the BBB.
Ros says
Can the amounts for 2025 for income brackets change after 12/31/ 2025 and affect our Medicare premiums in 2027?
The Wizard says
They certainly can!
IRMAA tiers for 2027 will not be finalized until August of 2026…
Jeff Enders says
@Ros – are you asking whether the IRMAA limits can change after 12/31/25 for 2027?
the answer to this question us “yes”, since the inflation rate through August, 2026 determines the IRMAA brackets to be used in 2027.
That is the whole purpose of Harry’s webpage – to help guide everyone’s expectation given that we “lock in” to our AGI by 12/31/25 yet the IRMAA limits do not lock in until the August, 2026 CPI is published.
David Swanson says
What are the details of any deduction on your tax return for 2025 (filed in 2026) for charitable contributions, if you do not itemize deductions, as a result of the Big Beautiful 2025 Bill?
DBS
Harry Sit says
No such deduction is allowed in 2025. It only starts in 2026, and it doesn’t affect MAGI or IRMAA.
Jeff Enders says
David – for 2025 tax year (filing early 2026), there are no changes for charitable contributions in the BBB.
My understand for 2026 tax year (filed early 2027), if not itemizing you would be able to deduct up to $1,000 (Single) and $2,000 (Joint) of charitable contributions. Also, if you do itemize, .5% of your AGI would be subtracted from the charitable contributions that are eligible for SCH A.
JoeTaxpayer says
This might be a good place and time to remind people of QCD. The ability to make a charitable deduction directly from your retirement account if you are 70 1/2 or older.
For those who don’t have enough deductions to itemize it effectively as a deduction of your charitable donations. The donation made from the IRA is not part of your taxable income. If you were going to withdraw say $10,000 and have $2400 in tax due, Donating directly to the charity avoid this.
Whenever I mention this on social media, people are quick to point out that there’s no free lunch and that “throwing away $10,000“ to save $2400 doesn’t make sense. They missed the point 100% this advice is only for people who are going to make the donation anyway. Just wanted to clarify that.
Patrick says
Thanks Harry, Jeff, Wizard, Tom. I will eat it, but just for one year. Not much I could have done about it even if I knew of Harry’s site. I probably would have put money in a zero interest checking account. Still, I argue that IRMAA is very very poorly implemented, and it is grossly unfair to force seniors to try to fool with their income two years in advance of IRMAA tax implications (I see IRMAA as a tax, like any other tax).
JoeTaxpayer says
I agree with you for many reasons.
First, the nature of how IRMAA is calculated, a series of cliffs, no phasing, creates some situations where the next dollar of income triggers an extra $1000+ of premium.
And, for the fact that these cliffs do not match up with marginal rates is absurd, in my opinion. TBH I don’t know what’s fair anymore, as I’ve been told that my SALT deduction should be capped, or eliminated completely, but the $25M+ couple shouldn’t pay a dime in estate tax. Because the average person can really relate to leaving a fortune behind.
Bev says
Wholeheartedly agree with Patrick about IRMAA. It is an additional tax, just as the NIIT 3.8% Medicare surtax is. That is two additional tax “contributions” to the Medicare system. And, the $200,000/$250,000 income threshold is not indexed for inflation either.
Robert H says
Joe, Trump’s OBBB bill signed on 7/4/25 increased the SALT deduction (starting this year) from $10K to $40K. The $40K cap will increase by 1% per year through 2029 and then revert to $10K in 2030. Also, the OBBB indicates that the federal estate tax exemption has been increased from $13.99 million per person ($27.8 million per couple) to $15 million per person ($30 million per couple), and this is permanent.
Dennis McFall says
I appreciate all the comments previously submitted. One thing that really sticks in my craw is the stated purpose of the IRMMA which is to have those in higher income brackets pay more for Medicare (Means Testing.) If this is the case, why then does the person who withdraws $100,000 from a Roth not have to participate in the RMAA debacle? They already receive the benefit of not paying income tax on their Roth money. In addition this same money is then excluded fromThe Means Testing relative to IRMAA. When I started an IRA in 1975 the Roth was not available and to convert at that time would have resulted in a heavy tax bill (OK, tough some of you say) but my point is the inequity in the treatment of income as it relates to IRMAA. If I end up with the same income as the Roth participant he doesn’t pay income tax or an additional IRMAA component on his Roth related income which technically is the same as mine. So much for means testing.
tom says
My Roth has been entirely funded via SEP-IRA distributions. The first year
that I took a SEP-IRA distribution to fund the Roth, I was 66, and didn’t
realize what an effect it would have on both my income tax liability,
and my IRMAA liability. At the time, I wasn’t even familiar with IRMAA.
So, that year I took a large distribution, and ended up paying a substantial
amount of IRMAA two years later. So, I learned my lesson, and have been
very careful to limit my IRA distributions so that I can mitigate my IRMAA
liability.
But over the years, I have made some minor miscalculations that have
caused me to cross over into the next higher IRMAA bracket, which is
a painful experience.
John says
Instead of weakening Roth
I’d like to see IRA distributions and Roth conversions excluded from MAGI for Medicare. Using your own savings is NOT income.
I agree, have those with true high ‘income’ pay more, but using your own savings is NOT income. The present setup discourages people from saving for retirement, and in my opinion, is morally wrong.
While yes, we should pay taxes on it, (albeit it should be taxed as long-term capital gains, not ordinary income) — it should not affect our Medicare rates.
Now that the Big Bill is law, and it didn’t really help seniors, I’d like to see a congressional committee try to right this wrong. Anyone game to help approach the right Committee (via your representatives) ??
I’d like the ability to work up cost estimates for such a change, but I lack access to the data that would be necessary to do so. Also, in my opinion, this should have taken priority over $1000/kid born and no tax on overtime or tips.
MrPG says
“They already receive the benefit of not paying income tax on their Roth money“
Well, I certainly paid income tax on my Roth contributions. Not sure how this computes…
The Wizard says
Good luck with that…
tom says
Ditto, I have paid plenty of income tax on the SEP-IRA distributions that I have taken. I’ve placed the net distributions amounts into my Roth IRA account. Hence, I don’t see where it would be fair for the government to charge me for taxes whenever I take a distribution from my Roth IRA account in the future.