I’ve had clients call me confused after getting a letter from Social Security telling them their Medicare Part B premium just went up — sometimes by hundreds of dollars a month. They didn’t do anything wrong. Their income was what it was. But because they crossed an income threshold two years earlier, they’re now paying significantly more for Medicare coverage this year.
That’s IRMAA. And if you’re a higher-income retiree, there’s a real chance it’s affecting you right now — or will in the near future.
What Is IRMAA?
IRMAA stands for Income-Related Monthly Adjustment Amount. It’s a surcharge added to your standard Medicare Part B and Part D premiums if your income exceeds certain thresholds. In 2026, those thresholds start at $109,000 for individual filers and $218,000 for married couples filing jointly.
For 2026, the standard Medicare Part B premium is $202.90 per month. If you’re subject to IRMAA, that premium increases — starting at $284.10 per month at the first income tier and climbing as high as $689.90 per month at the highest bracket. Add in the Part D surcharge, which ranges from an additional $14.50 to $91.00 per month, and at the highest bracket you could be looking at $15,000–$18,000+ per year in total Medicare premiums for a couple (depending on your specific Part D plan).
The Two-Year Lookback Problem
Here’s what trips people up: IRMAA is not based on your current income. It’s based on your income from two years ago. Your 2026 Medicare premiums are determined by what showed up on your 2024 tax return.
That creates a specific problem for retirees who had a high-income year before or during retirement — a business sale, a large Roth conversion, a profitable real estate transaction — but now live on a more modest income. The income spike happened, the IRS saw it, and now Medicare is billing you for it two years later.
The Cliff Effect Is the Dangerous Part
IRMAA doesn’t phase in gradually. It’s a cliff. That means $1 over a bracket threshold triggers the full surcharge for that entire tier. For a married couple, crossing the first threshold at $218,000 triggers an additional $2,297 per year in Medicare premiums — for both of them. That’s why income management in the years before and during Medicare enrollment isn’t optional. It’s a planning necessity.
How Retirees Can Reduce IRMAA Exposure?
Roth Conversions Before Age 63
Since IRMAA is based on income two years prior, conversions done before Medicare begins generally don’t affect Medicare costs — though they do affect future RMDs and the tax picture downstream. Conversions after 63 need to be sized carefully to avoid triggering or worsening IRMAA.
Qualified Charitable Distributions
For retirees over 701⁄2, directing IRA money to charity via a QCD keeps that income out of your MAGI entirely. A $40,000 QCD that satisfies part of your RMD doesn’t count toward the threshold that triggers IRMAA.
The SSA-44 Appeal
If your income dropped significantly due to a qualifying life event — retirement, the death of a spouse, divorce — you can appeal your IRMAA determination using Form SSA-44. The Social Security Administration can use more recent income data rather than the two-year-old return, which can reduce or eliminate the surcharge.
Strategic Withdrawal Sequencing
The order in which you draw from different accounts — IRA, Roth, taxable brokerage — directly determines your MAGI. Getting this wrong doesn’t just cost you in income taxes. It can push you into an IRMAA bracket you didn’t need to be in.
Why This Is a CPA Problem, Not Just a Financial Planning Problem?
Most financial advisors look at IRMAA through the lens of ‘how does this affect my client’s cash flow?’ I look at it through the lens of ‘what decisions made two years ago caused this, and what can we do in the next 24 months to prevent the same mistake?’ That’s the difference between reacting to your Medicare bill and engineering it. If your income puts you anywhere near the $109,000 or $218,000 threshold, this conversation is worth having before the two-year clock runs out.
Want a personalized RMD, IRMAA, or Social Security plan that fits your exact numbers? Schedule a retirement tax review with me at Creative Financial Group.
These blogs are intended for educational purposes and represent general information about retirement planning strategies. Individual circumstances vary. Consult with a qualified financial planner and tax professional before making decisions regarding your retirement income strategy.
IRMAA brackets are subject to change by the Social Security Administration or through future legislation.