Income-related monthly adjustment amount (IRMAA) is a surcharge added to Medicare Part B and Part D premiums for higher-income beneficiaries. But higher income doesn’t necessarily mean that only the “ultra-rich” come under this surcharge. There are several reasons you could fall under IRMAA.
Medicare Part B is medical insurance for services outside of a hospital in-patient setting, while Part D covers prescription medications.
When Does IRMAA Apply
According to Centers for Medicare & Medicaid Services, since 2007, beneficiaries’ Part B monthly premiums have been based on income.Beneficiaries who file individual tax returns with a modified adjusted gross income (MAGI) less than or equal to $109,000 don’t come under the surcharge. In 2026, they pay the standard $202.90 monthly premium amount.
Also, married beneficiaries who file jointly with a MAGI of less than or equal to $218,000 don’t have to pay a surcharge. They pay the standard amount.
But those who earn above these thresholds are charged an IRMAA surcharge. It’s a tiered scale and the surcharge increases the more income is earned.
Part D monthly premiums work the same way.
What Determines an IRMAA Appeal
An IRMAA can add hundreds of dollars to your Medicare premium. But life circumstances change. So, if you have had adjustments to your income that affect the IRMAA, you can appeal.According to the Medicare Interactive by the Medicare Rights Center, the SSA will mail you a notice called an initial determination. It will include information on how to request a new initial determination.
You can request that the SSA revisit its decision if you’ve experienced a life-changing event that caused your income to decrease.
- death of a spouse
- marriage
- divorce or annulment
- you or your spouse stopped working or reduced the number of hours worked
- involuntary loss of income-producing property due to a natural disaster, disease, fraud, or other circumstances
- loss of pension
- receipt of settlement payment from a current or former employer due to the employer’s closure or bankruptcy
This may have happened if you filed an amended tax return to the IRS. You may also have a more recent return that shows you’re receiving less income than the SSA determined.
Failing to inform the SSA about a life-changing event can cost you thousands of dollars in premiums.
Can You Appeal Further if Denied a Lower IRMAA?
If you don’t qualify to request an initial determination but disagree with the IRMAA decision, you can appeal.However, there are no strict timeframes in which the SSA must respond to or consider a request. If your request is successful, the premium amounts will be corrected.
If denied, you can appeal to the Office of Medicare Hearings and Appeals (OMHA) level within 60 days. If the OMHA denies your claim, you can appeal to the Medicare Appeals Council. If that doesn’t go well, you can take it to the federal district court with jurisdiction over the area where you live within 60 days of the date the Medicare Appeals Council denied it.
Plan to Avoid the IRMAA Surcharge Through Planning
To avoid the surcharge trap, it’s important to plan before reaching 65. Being just one dollar over a threshold can move you to the next premium tier.Many retirees believe they’ve optimized their situation by holding municipal bonds or delaying retirement withdrawal, only to be hit with the IRMAA surcharge.
According to Forbes, tax planning before and during retirement is vital. For example, taking a large bonus, selling a professional practice, taking a Roth conversion, or other similar actions, without coordinating the tax impact, can send you into a higher IRMAA tier.
Avoid taking large, one-time withdrawals from your traditional IRA or other tax-deferred accounts.
Roth conversions made before Medicare age may increase taxable income now, but they can potentially limit future required minimum distributions (RMDs) and future IRMAA exposure.
If you’re still working, contribute to your 401(k) or other tax-deferred accounts.
Think of Medicare planning as tax planning.
