IRMAA: how income affects Medicare premiums

Most people on Medicare pay the standard premium for Part B and whatever their drug plan charges for Part D. People with higher incomes pay more. The extra charge is called the income-related monthly adjustment amount, or IRMAA. According to the Centers for Medicare & Medicaid Services, it affects roughly 8% of people with Part B. It often comes as a surprise because it is based on income from two years earlier, and a single unusual year can trigger it.

What IRMAA is

IRMAA is an addition to two premiums:

• the Part B premium, which covers doctor and outpatient care, and
• the Part D premium, which covers prescription drugs.

It applies whether a person has Original Medicare or a Medicare Advantage plan. For background on the parts themselves, see Medicare Parts A, B, C and D explained. The Social Security Administration makes the determination using tax data from the IRS and notifies the people affected. For people receiving Social Security, Part B premiums and the IRMAA amounts are generally deducted from the monthly benefit.

Which income counts, and from which year

IRMAA uses a specific measure called modified adjusted gross income, or MAGI. Under Social Security's definition, it is:

• adjusted gross income from the federal tax return, plus
• tax-exempt interest income.

The premium for a given year is generally based on the tax return from two years before. Premiums for 2026 are generally based on 2024 income. If that return is not available, the return from three years before may be used.

Adjusted gross income includes wages, taxable pension and retirement account withdrawals, the taxable part of Social Security, capital gains, and amounts converted to a Roth account. Qualified withdrawals from Roth accounts are generally not part of adjusted gross income.

The 2026 brackets

The table below shows the total monthly Part B premium and the added Part D amount for 2026, from the CMS fact sheet. Social Security's sliding scale tables show the same amounts. Amounts are per person, so each spouse on Medicare pays separately.

The Part D adjustment is paid in addition to the plan's own premium.

People who are married, lived with their spouse at any time during the year and file separately face a compressed schedule for 2026: the standard premium at $109,000 or less, $649.20 for Part B (plus $83.30 for Part D) above $109,000 and under $391,000, and the top amounts at $391,000 or more.

As of mid-November 2026, the 2027 brackets and premiums had not yet appeared on Medicare.gov's cost page, where they are posted once announced.

The brackets are steps, not a slope

Income tax brackets apply a higher rate only to the dollars above each threshold. IRMAA does not work that way. Crossing a threshold by any amount moves the whole premium to the next tier for the year.

As a hypothetical example, suppose a married couple, both on Medicare, reported MAGI of $230,000 on their 2024 joint return.

• That is over the $218,000 threshold, so each spouse's 2026 Part B premium is $284.10 instead of $202.90, an extra $81.20 a month.
• Each also pays a $14.50 Part D adjustment.
• Together that is $191.40 a month, or about $2,297 over the year, more than they would have paid with MAGI of $218,000 or less.

Events that often push income over a threshold

Because the measure is a single year's income, one-time events matter. Common examples:

• Roth conversions. The converted amount is included in income for that year. See Roth conversions explained.
• Selling appreciated investments or property. A large capital gain raises adjusted gross income.
• Required minimum distributions. Withdrawals the law requires from pre-tax accounts add to income each year. See required minimum distributions: the basics.
• A final year of high earnings. Someone who retires at 65 may have premiums in the first two years of Medicare based on full-time pay.

The surcharge is redetermined every year, so it lasts only as long as the income that caused it. The article on how different kinds of retirement income are taxed explains which income sources feed into adjusted gross income.

When income has dropped: life-changing events

The two-year look-back can produce a premium that no longer matches a person's circumstances, most often right after retirement. Social Security's rules allow a person to request a new determination using a more recent year if income fell significantly because of a life-changing event. The qualifying events are:

• death of a spouse,
• marriage,
• divorce or annulment,
• work reduction,
• work stoppage,
• loss of income-producing property,
• loss of an employer pension, and
• receipt of a settlement payment from a current or former employer.

The request is made to the Social Security Administration, commonly on Form SSA-44, with an estimate of the more recent year's income. Retirement falls under work stoppage, which makes this route relevant to many new retirees.

One-time investment events are not on the list. A higher premium caused by a large capital gain or a Roth conversion generally cannot be reduced this way, though it applies only for the year tied to that income.

Questions worth asking

• What was MAGI two years ago, and how close was it to a threshold?
• Is a large one-time income event planned, and which premium year would it affect?
• Has income dropped because of retirement or another listed event, so that a new determination could be requested?