If your Medicare Part B or Part D premiums are higher than expected, you are likely paying an Income-Related Monthly Adjustment Amount -- IRMAA. This surcharge is based on your modified adjusted gross income from two years prior, and it is assessed as a cliff: exceeding a threshold by one dollar triggers the full surcharge for that tier. Understanding the lookback period and the bracket structure is essential for anyone making Roth conversion, retirement income, or asset sale decisions.
IRMAA is a Medicare surcharge, not a tax. It is based on your modified adjusted gross income from two years prior and assessed as a cliff -- exceeding a threshold by one dollar triggers the full surcharge for that tier. A single dollar of income can swing your annual premium cost by nearly $4,000 for a couple.
IRMAA is not a tax. It is an additional amount added to your standard Medicare Part B and Part D premiums, charged to higher-income beneficiaries. The standard Part B premium for 2026 is $202.90 per month. If your income exceeds certain thresholds, you pay the standard premium plus a surcharge that ranges from $81.20 to $406.90 per month per person, depending on the bracket. CMS: 2026 Medicare Parts B Premiums and Deductibles.
Part D (prescription drug) plans carry a separate IRMAA surcharge on top of the plan's own premium. The Part D surcharges range from $13.70 to $85.80 per month per person for 2026.
Social Security determines your IRMAA based on your modified adjusted gross income (MAGI) -- which for IRMAA purposes equals your AGI plus tax-exempt interest income. SSA uses IRS data from Form SSA-1099 and the tax return filed for the applicable lookback year.
The Two-Year Lookback
IRMAA uses a two-year lookback. Your 2026 premiums are based on your 2024 tax return (the most recent return available when SSA makes the determination in late 2025). Your 2027 premiums will be based on your 2025 return.
This delay is what catches people off guard. A one-time income spike in 2024 -- a Roth conversion, the sale of a property, a large capital gain distribution, or deferred compensation payout -- will not hit your Medicare premiums until 2026. By then, the income event is long past and the surcharge feels arbitrary.
The lookback also means that retirement itself does not immediately reduce your IRMAA. If you retired in January 2026 with a dramatically lower income, your 2026 premiums still reflect your higher 2024 income. The lower income will not show up in your premiums until 2028 (based on the 2026 return).
2026 IRMAA Brackets: Part B
The brackets below are based on modified AGI from 2024 tax returns. For married couples filing separately who lived together at any point during the year, a separate and much less favorable bracket structure applies.
| Individual MAGI | Married Filing Jointly MAGI | Monthly Part B Premium (per person) | Monthly Surcharge Above Standard |
|---|---|---|---|
| $109,000 or less | $218,000 or less | $202.90 | $0 |
| $109,001 - $136,000 | $218,001 - $272,000 | $284.10 | $81.20 |
| $136,001 - $170,000 | $272,001 - $340,000 | $405.00 | $202.10 |
| $170,001 - $214,000 | $340,001 - $428,000 | $525.90 | $323.00 |
| $214,001 - $499,999 | $428,001 - $749,999 | $566.10 | $363.20 |
| $500,000 or more | $750,000 or more | $609.80 | $406.90 |
Technical detail
2026 IRMAA Brackets: Part D
Part D IRMAA surcharges follow the same income brackets as Part B but with different dollar amounts. These surcharges are added on top of whatever your prescription drug plan charges.
| Individual MAGI | Married Filing Jointly MAGI | Monthly Part D Surcharge |
|---|---|---|
| $109,000 or less | $218,000 or less | $0 |
| $109,001 - $136,000 | $218,001 - $272,000 | $13.70 |
| $136,001 - $170,000 | $272,001 - $340,000 | $35.30 |
| $170,001 - $214,000 | $340,001 - $428,000 | $57.00 |
| $214,001 - $499,999 | $428,001 - $749,999 | $78.60 |
| $500,000 or more | $750,000 or more | $85.80 |
CMS: 2026 Medicare Part D IRMAA amounts.
IRMAA uses a two-year lookback. Your 2026 premiums are based on your 2024 tax return. A one-time income spike -- a Roth conversion, property sale, or deferred compensation payout -- will not hit your Medicare premiums until two years later, when the income event is long past and the surcharge feels arbitrary.
IRMAA brackets are cliffs, not gradual phase-ins. If a married couple's combined MAGI is $218,000, they pay no surcharge. At $218,001, they each pay an additional $81.20 per month -- $1,948.80 per year per person, or $3,897.60 per year for the couple. One dollar of income triggers the full surcharge for that tier.
This cliff structure makes income planning near the thresholds extremely valuable. A $1 difference in MAGI can swing your annual cost by nearly $4,000 for a couple in Part B alone, and more when Part D surcharges are included.
Dollar example: A retired couple has $215,000 in projected MAGI. They are considering a $10,000 Roth conversion. Without the conversion, they pay the standard $202.90 each per month. With the conversion, their MAGI rises to $225,000, pushing them into the first IRMAA bracket. The cost: $81.20 per person per month for 12 months = $1,948.80 per person = $3,897.60 for the couple. The $10,000 Roth conversion just cost them an extra $3,898 in Medicare premiums two years from now, on top of the income tax on the conversion itself.
The Connection to Roth Conversions
Roth conversions are one of the most common triggers for unexpected IRMAA surcharges. A conversion adds the converted amount to your AGI in the year of the conversion. Two years later, that AGI determines your IRMAA bracket.
This does not mean Roth conversions are a bad idea for retirees. It means the IRMAA cost must be factored into the conversion analysis. A CPA should model the conversion to show:
- The income tax on the conversion itself
- The IRMAA surcharge two years later (Part B + Part D, for both spouses if married)
- The long-term tax savings from having the money in a Roth (no RMDs, tax-free growth, tax-free withdrawals)
- Whether a smaller conversion that stays below the IRMAA cliff produces a better after-tax result
The math often favors the conversion even with the IRMAA hit, especially if the retiree is in a temporarily low bracket. But the IRMAA cost changes the breakeven calculation and sometimes makes a partial conversion the right answer.
- Crosses the $218,000 MFJ IRMAA threshold
- Both spouses pay $81.20/month surcharge for 12 months
- IRMAA hit arrives two years after the conversion
- Total additional Medicare cost on top of conversion tax
- Stays at or below the IRMAA threshold
- Both spouses pay the standard $202.90/month premium
- Smaller conversion but no cliff penalty
- Still makes progress on Roth conversion strategy
If your income dropped significantly due to a qualifying life event, you can request that SSA use your current-year (or more recent) income instead of the two-year lookback. The request is filed on Form SSA-44: Medicare Income-Related Monthly Adjustment Amount -- Life-Changing Event.
Qualifying life-changing events include:
- Marriage
- Divorce or annulment
- Death of a spouse
- Work stoppage (retirement, layoff, or reduction in hours)
- Work reduction (including loss of income-producing property due to a disaster, loss of pension income, or receipt of settlement from an employer)
- Loss of income-producing property due to a disaster or other event beyond your control
The event must have caused your income to decrease. You will need to provide documentation of the event (marriage certificate, death certificate, letter from employer confirming retirement date) and an estimate of your current-year income.
Dollar example: A widow whose husband died in 2025 had combined MAGI of $350,000 on their 2024 joint return. Her 2026 IRMAA is based on that joint income, placing her in the third tier ($405.00/month). Her own income in 2026 is $90,000. By filing Form SSA-44 with a death certificate and her projected income, she can request a reduction to the standard premium -- saving $202.10 per month, or $2,425.20 per year.
You can file SSA-44 online through your my Social Security account, by calling SSA at 1-800-772-1213, or by visiting your local SSA office. Processing typically takes 30 to 60 days. If approved, the adjustment is retroactive to January of the year in which the premium applies.
SSA can only use income from the year of the event or a more recent year. They cannot go further back. And the reduction applies only for the year in question; future years will use the standard two-year lookback unless another qualifying event occurs.
Other Income Events That Trigger IRMAA
Beyond Roth conversions, several common financial events can push MAGI above an IRMAA threshold:
- Sale of a home or investment property -- the capital gain (minus the $250,000/$500,000 home sale exclusion if applicable) adds to MAGI
- Required Minimum Distributions (RMDs) -- as retirement account balances grow, RMDs can push you into higher IRMAA brackets over time
- Capital gain distributions from mutual funds -- these appear on your 1099-DIV and add to MAGI even if you reinvested the distribution
- Tax-exempt interest -- municipal bond interest is included in MAGI for IRMAA purposes even though it is excluded from regular federal income tax
- Deferred compensation payouts -- large lump-sum payments from deferred comp plans can create a one-year spike
- Settlement payments or legal awards
Planning Strategies
IRMAA-aware planning does not mean avoiding income. It means managing the timing and character of income to avoid unnecessary cliff effects. Practical strategies include: