Understanding IRMAA
The income surcharge that surprises many new retirees.
What IRMAA is
IRMAA — Income-Related Monthly Adjustment Amount — is an extra amount added to your Part B and Part D premiums when your income is above a threshold. It applies to both parts separately and is billed monthly (usually deducted from Social Security).
How it's calculated
The Social Security Administration looks at your Modified Adjusted Gross Income (MAGI) from your tax return two years ago. So the 2026 IRMAA determination uses your 2024 tax return. There are five income brackets above the base threshold, each with a higher surcharge.
Approximate 2025 thresholds
Individuals with MAGI above about $106,000 — or couples above about $212,000 — start paying IRMAA. Higher brackets apply at approximately $133,000, $167,000, $200,000, and $500,000 for individuals (double for joint filers). Thresholds update annually.
The two-year lag
Because IRMAA uses income from two years back, a one-time income spike (Roth conversion, home sale, large capital gain) can trigger higher premiums two years later — even if your income has since dropped.
Appealing IRMAA
If your income dropped because of a life-changing event — retirement, loss of pension, death of a spouse, divorce, or loss of income-producing property — you can appeal using Form SSA-44. Provide documentation of the event and your new expected income.
Planning around IRMAA
Because IRMAA has hard cliffs (one dollar over a bracket triggers the full surcharge for the year), managing taxable income near thresholds — through the timing of Roth conversions, capital gains, and withdrawals — can save meaningful money.