IRMAA Explained: Medicare's Higher Income Premiums

IRMAA stands for income-related monthly adjustment amount. It is an extra charge added to your Medicare Part B premium and to your Part D drug coverage premium when your income is above a set level. In 2026 it starts when your modified adjusted gross income is above $109,000 on an individual tax return or $218,000 on a joint return, according to CMS. Social Security looks at your tax return from two years earlier, so 2026 amounts are based on 2024 income. If your income has dropped since then because you retired, lost a spouse or had another life-changing event, you can ask Social Security to use a more recent year. This guide explains how the surcharge is set, what it costs in 2026, and the steps to take if you think it no longer fits your life.

What IRMAA is, in plain English

Most people pay the standard Part B premium, which CMS set at $202.90 a month for 2026. People with higher incomes pay that standard amount plus an adjustment. The same idea applies to Medicare drug coverage: if you are in a Part D plan, or a Medicare Advantage plan that includes drug coverage, a separate Part D adjustment is added on top of your plan premium.

IRMAA is not a penalty and it is not something a plan or an agent sets. It comes from federal law, and Social Security makes the decision using information from the IRS. Your plan choice does not change it. Someone with a Medicare Supplement and someone with a Medicare Advantage plan, at the same income, pay the same Part B adjustment.

The surcharge is per person. If you and your spouse both have Medicare and file jointly, each of you pays the adjustment on your own premium.

Which income counts, and from which year

Social Security uses your modified adjusted gross income, often shortened to MAGI. For IRMAA, the Social Security operations manual (POMS HI 01101.010) defines it as your adjusted gross income plus any tax-exempt interest income. Both numbers come straight from your federal Form 1040. That means interest from municipal bonds, which does not show up in adjusted gross income, still counts here.

The tax year is generally two years before the premium year. The same manual gives the example that 2026 premiums are generally based on 2024 tax return information. Under that rule, a 2027 IRMAA decision will generally look at your 2025 return.

This look-back is why IRMAA often surprises people in their first years of Medicare. The year you are measured on may still include a full salary, a large bonus, the sale of a house or business, a big withdrawal from a retirement account, or a Roth conversion. Anything that raised your adjusted gross income in that one year counts in full for that year.

The 2026 IRMAA brackets from CMS

These are the official 2026 amounts. The income ranges are for 2024 MAGI. CMS has not yet announced the 2027 Part B premium or the 2027 IRMAA brackets: as of October 19, 2026, the CMS page for 2027 amounts was not yet published. They are usually released in the fall, and we will update this guide when they are.

What the surcharge adds up to over a year

A few worked examples help. These use the 2026 CMS amounts and are only illustrations, not a prediction of your bill.

• A single filer with $120,000 of 2024 MAGI lands in the first bracket. Part B is $284.10 instead of $202.90, which is $81.20 more a month. With a drug plan, add $14.50 a month. Together that is $95.70 a month, or $1,148.40 for the year.
• A married couple filing jointly with $300,000 of 2024 MAGI lands in the second joint bracket. Each spouse pays $405.80 for Part B, $202.90 more than standard, plus a $37.50 Part D adjustment. That is $240.40 a month per person, or $5,769.60 a year for the two of them.
• Just one dollar over a bracket line moves you into the higher amount for the whole year. There is no partial step. That is why it can pay to look at the Medicare effect before you sell an asset or convert retirement money, not after.

How you find out, and how you pay

Social Security mails a notice, called an initial determination, that explains the amount and the tax year it used. If you get Social Security benefits, the Part B premium, including any adjustment, is normally taken from your monthly check.

The Part D adjustment is paid to Medicare, not to your drug plan, even though it is tied to your drug coverage. If it cannot be withheld from your benefit, Medicare bills you directly. Keep paying it: unpaid Part D adjustments can cost you your drug coverage.

Life-changing events and Form SSA-44

If your income has gone down since the tax year Social Security used, you can ask it to use a more recent year. The Social Security manual (POMS HI 01120.005) lists eight life-changing events that qualify:

• Death of a spouse
• Marriage
• Divorce or annulment
• Work reduction
• Work stoppage, which includes retiring
• Loss of income-producing property
• Loss of an employer pension
• Receipt of a settlement payment from a current or former employer

Appealing an IRMAA decision

There are two different paths, and it helps to pick the right one.

• New initial determination: use this when you have a life-changing event, when the IRS information was wrong, or when you filed an amended return. You give Social Security the newer or corrected information and it recalculates. This is usually the faster route.
• Reconsideration: use this when you think Social Security applied the rules incorrectly. The manual (POMS HI 01140.001) allows a request within 60 days of receiving the notice, and receipt is presumed to be five days after the date on the notice.

Planning ideas to talk through with your tax professional

We are not tax advisors, and the right move depends on your full picture. These are the questions we suggest you bring to a CPA or financial planner, especially in the two years before you turn 65 and the first years after:

• Will a home or business sale, or a large capital gain, land in a year that Medicare will look at?
• Would spreading a Roth conversion across several years keep you under a bracket line?
• Are tax-exempt bond interest and required minimum distributions part of your MAGI estimate?
• If you stop working this year, do you have the paperwork ready for Form SSA-44 next year?

---

The bottom line

IRMAA is a set federal surcharge, not a plan price, so the goal is to understand it and plan around it, not to shop it away. Check your MAGI from two years back against the 2026 table, watch for one-time income spikes, and if your income has dropped because of a life-changing event, ask Social Security to use a newer year. When you are ready, we can go through your Medicare options with your full costs in view, IRMAA included. You can also try our IRMAA calculator first.