[The next update will be on September 11, 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?
History of IRMAA
IRMAA was added to Medicare by the Medicare Prescription Drug, Improvement, and Modernization Act of 2003. The Republican Congress under President George W. Bush passed it in November 2003.
IRMAA started with only Part B. The Patient Protection and Affordable Care Act, passed in 2010 by the Democratic Congress under President Obama, expanded IRMAA to also include Part D.
The Bipartisan Budget Act of 2018, passed by the Republican Congress under President Trump, added a new tier for people with the highest incomes.
IRMAA has been the law of the land for over 20 years. Different congresses and administrations from different parties made small tweaks, but its structure hasn’t changed much since the beginning. IRMAA has become a bipartisan consensus. There’s no impetus for major changes.
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.
If your income is near a bracket cutoff, try to keep it low and 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 11 data points right now out of the 12 needed for the IRMAA brackets in 2026 (based on 2024 income).
If annualized inflation in 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 August 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: <= $139,000 Married Filing Jointly: <= $278,000 | 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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Joe Taxpayer says
Whining? Is that what you call people strategizing about how to optimize their finances?
If that’s the case, please share how you feel about the tax cut for billionaires making the lower 50% far worse off.
Hans Heijmans says
Nothing wrong with strategizing about tax planning around the existing rules. That’s what this site is for. The “whining” comment refers to the incessant complaining about the existing rules. That gets tiresome and does not add anything useful for this site.
And on tax cut for billionaires: those are ridiculous, and I am with Warren Buffett on that.
Nancy Memmel says
I didn’t write the post, so I could be dead wrong, I suppose, but I don’t think he meant the strategizing part, just the opining about how the structure “should” be in individual people’s ideal worlds. In a system where revenue is raised to subsidize some people it necessarily is at the expense of other people, and everyone has an opinion; all of which are irrelevant to the strategizing issues.
Paul says
When reading or commenting about the distribution of federal income taxes, I suggest that interested readers refer to this IRS data:
https://www.irs.gov/pub/irs-soi/22in41ts.xls
It has information about the total income, total federal income tax paid, average tax rate, the share of total income, and the share of total federal income tax… for successively larger cohorts, starting at the top 0.001%, to the top 50%. Note that each column is inclusive of the taxpayers in the columns to the left, but if you have any skills in Excel, you can easily create a similar table that separates each percentile into brackets.
Data is provided for tax years 2001 – 2022. A new version including tax year 2023 should be published soon.
If you want to consider all federal taxes (individual income, corporate income, social insurance, excise), the Congressional Budget Office has published that data, broken into quintiles, from 1979-2020:
https://www.cbo.gov/publication/59509
The Supplemental Data section has the Excel workbooks that back up the report. I will caution that it is not easily comprehended unless you are skilled in Excel, specifically with Pivot Tables.
If you are really interested in this subject, I recommend taking the time to look at this data. You will likely be surprised, as it belies the usual consensus.
TwoGeez says
It saddens me to see Harry’s excellent site being hijacked by these arguments. It sounds more like a Reddit thread (which would better be held there). Can we PLEASE get back to comments and explanations that can help us all manage against the IRMAA thresholds? /offmysoapbox
Deb says
Am I understanding that the income threshold for my 2027 IRMAA (calculated based on my 2025 MAGI) will be higher than $212K? I am close to that now and would like to know that I have some breathing room. You think it will be over $218K. Thank you
Henry Waldron says
The 2026 IRMAA threshold, referenced to 2024 MAGI, will likely be $218,00 for a couple filing jointly, half that amount for a single taxpayer.
It could be slightly higher or lower if something calamitous happens to inflation between now and October. Since the single taxpayer number is rounded, I’m not sure how crazy the changes would need to be. I’m also not sure what might happen if we suddenly don’t get monthly updates, or if some alternative formula is suddenly introduced.
The 2027 IRMAA threshold, referenced to current (2025) MAGI, would normally be higher than the 2026 threshold. How much depends upon the inflation over the next year starting in October 2025. At 2% inflation, the $218,000 applied in 2026 MAGI would go to ~ $222,000 applied to 2027 MAGI
The Wizard says
As you can see from the chart for 2025 income, the first IRMAA tier is projected to start for MFJ MAGI of $220k if zero inflation for next 13 months, or $224k if 3% inflation.
We’ll know a bit more by mid December, which gives folks time to figure their Roth conversion amount for the year or, in some cases, their QCD amount…
GeezerGeek says
After we get the November CPI reports, which is due to be released on December 10, I will create an IRMAA bracket inflation threshold report that will show what rate of inflation will be needed for a bracket limit to change. A hypothetical example of this would be it would take 3.15% inflation rate for the bracket limit to change from $212K to $214K. It will show you how much or little breathing room you have for 2025 income that will determine the 2027 IRMAAs.
I wish this Comments section would support images or tables. That would make it easier to post the report but I’ll probably have to provide a link to an image so that everyone can view the report.
LIftLock says
GeezerGeek,
If you post the inflation sensitivity thresholds like you did last year, I will put in a spreadsheet and share it with everyone like I did last year.
GeezerGeek says
Liftlock,
Thanks for offering to help, but I copied the numbers out of a spreadsheet to paste them into Comments and then tried to format them into something readable in the Comments section. So, it is no more work for me to publish the spreadsheet that I initially created. I’ll probably also save a CSV of the spreadsheet and paste that into Comments so that others who are too cautious to click on a link can paste that into their own spreadsheet.
Jerry says
Thank you for the article, it helps to plan to avoid IRMAA premiums.
Ron says
I would like to know who authorized the IRS to disclose our confidential tax information to Medicare and Social Security who acts as Medicares collection agent. If another agency came to the IRS and said that their fees are tied to income, would the IRS provide this information to them also? Where would it end?
Harry Sit says
Congress authorized it. They passed a law and the President signed it. Both the Secretary of the Treasury and the Commissioner of Social Security are tasked to implement the law. It’ll happen again if Congress passes another law that requires payments based on income and the President signs it. It would end when Congress stops passing such laws.
Harry Sit says
I added a new History section to the main post to outline how we got here. From the summary of the original law that brought us IRMAA:
“Subtitle B: Income-Related Reduction in Part B Premium Subsidy – (Sec. 811)
… …
Amends the Internal Revenue Code to direct the Secretary of the Treasury, upon written request from the Commissioner of Social Security, to make appropriate disclosure of tax return information to carry out the Medicare part B premium subsidy adjustment.”
There you go. Congress explicitly mandated the disclosure.
The Wizard says
The US Government allowed that.
Please relax and get off your high horse…
James says
I am looking for feedback on a strategy to safely stay below the 2025 limit for the predicted standard amount of $220K (MFJ, 0% inflation). I have yet to take my RMD for 2025. Let’s say that I accurately track my income for 2025 and determine that I would be approximately approximately $500 over the $220 limit at the end of the year.
Could I simply take $1,000 less than my 2025 RMD required amount in 2025 and push that $1,000 of income off until 2026 by taking the $1,000 RMD amount before April 15,2026? In other words, would the IRS let a person split their total required RMD for a particular year so that a portion of that RMD could be pushed into the following years income? Thoughts on this strategy?
Harry Sit says
Only your first RMD can be postponed to April 15. The deadline is December 31 for all subsequent RMDs.
Teresa Durden says
You could do a QCD for $1000, for that part of your RMD to Charity. That way, no tax to pay and you don’t count it on income. Plus it helps charities.
Nancy Memmel says
Assuming that 2025 is NOT the first year you have an RMD, Theresa’s QCD suggestion is about the ONLY way I can see you undercutting the IRMAA threshold.
QCDs are a tax efficient way to give what you would have given to charity anyhow. In this specific case, giving a 1,000 that you hadn’t intended to give would still be less money than paying the IRMAA charges in the first tier for a single person!
You could always pray for inflation, I suppose..
Jeff Enders says
James – beyond all the great suggestions from others, the other thing to consider is just “time”. Are you being ultra conservative to make this decision in August when you have until Dec 31 to execute a QCD (or the numbers change)? It’s also QUITE conservative to believe inflation is magically going to drop to zero next month and stick there for an additional 12 months.
if inflation stays at 2.5% for August – November (which you will know before making decisions in December) and then magically drops to 0% for the remaining eight months of the reporting year, the IRMAA limit would be $222,000 and you’d be fine.
Alternatively, if you have ANY cash sitting in an interest earning bank account, I’d move that to a non-earning account to help reduce that $500 overage in the months remaining in the year.
Worst Case – contributing $500 via a QCD PRIOR TO YEAR END is less expensive than the 40% penalty on $220 (2027 projected premium) for 12 months times 2 or $2,112. The QCD will reduce your AGI by the same $500 while still satisfying your RMD. It also reduces you tax based on your marginal tax rate, so a good outcome given the situation can be had.
The Wizard says
The QCD method works assuming at least part of your RMD comes from a tIRA. You can’t do QCDs from a 401(k) or 403(b)…
James says
Thanks to all for your thoughts on my question and the input about using the QCD strategy. The other way of moving income from one year to another is to purchase Tbills where interest is paid at maturity but this requires implementation throughout the year. You can’t wait till the end of the year to make much of a difference.
Tom Tran says
Hi Harry,
Thank you so much for the works over the years. I’m planning on Roth conversions over multiple years. I’d like to estimate the affects of the conversions to the income taxes as well as IRMAA. I would need to adjust the brackets — income tax brackets and IRMAA brackets — for each year to come as “close” to the actual numbers as possible.
For planning purposes, I’d like to adjust and have the brackets increased every year by 2% (the Fed target inflation). When you yearly publish the final numbers for IRMAA brackets and IRS for income tax brackets, I’ll make an update for the year accordingly. What would you suggest?
Thanks, Tom
The Wizard says
It’s easy to make broad planning estimates for income tax and IRMAA for the next five years or more based on estimated inflation.
But what really matters is what you do each December that determines your MAGI and your Taxable Income for the year.
Income taxes are easy and if you get your TI a few hundred dollars into the next higher bracket, it’s no big deal.
IRMAA is trickier so it’s best to adjust the Roth conversion amount you do each December to keep your estimated MAGI safely below the next higher IRMAA threshold per Harry’s estimates.
“Safely” could be $100 below if you have good estimates of your MAGI for the year.
But if you hold managed stock funds in your taxable account that have Capital Gains Distributions, that can upset your plan. Only hold index funds in your taxable account…
Jeff Enders says
James – a few thoughts:
1) decide what is your appetite for the highest tax bracket you can muster is as well as the highest IRMAA tier you can muster. It has to be part of a strategic decision. Depending on what happens to the money in the end (donate to charity versus leave it for your children or something in-between) is a big part of that decision.
2) are you funding the tax from other after-tax money or from the conversion itself?
3) Might be better to assume a higher inflation rate than 2%. At least in the short term doesn’t appear that the Fed is going to get to 2% as they haven’t gotten there yet and they are now prioritizing lower unemployment over lower inflation. Higher inflation mean more flexibility to do more conversions (since the tax bracket end point will be higher) which drives more cash needs if you are funding the tax from after-tax investments.
4) To the extent you have both bonds and stocks holdings across your Trad IRA and brokerage account, the Trad IRA should be where the bonds should be priorized and the brokerage account should be where the stocks are prioritized. If there are stocks and bonds in the Trad IRA, the stocks sholud be the priority for conversion over any bond holding in that Trad IRA.
just my two cents
LiftLock says
Tom Tran,
You could build a spreadsheet to project your future income, income taxes and IRMAA brackets / surcharges.
Retirement planning software can be used to accomplish the same thing, with much less work, and will likely provide a much greater insight into your long term financial picture.
Check out:
PralanaRetirementCalculator.com
Max-FiPlanner.com
Boldin.com
https://numbercrunchnerds.systeme.io/taxplanningtemplate
https://www.getrichslick.com/2024/05/23/review-the-retirement-nerds-tax-planning-template/
Harry Sit says
2025 and projected 2026 tax brackets are in 2025 2026 Tax Brackets, Standard Deduction, Capital Gains, QCD. My favorite tool for Roth conversion planning is in Roth Conversion with Social Security and Medicare IRMAA. I updated that post today to use the latest version of the tool.