Does Social Security income count against Irmaa?
Asked by: Prof. Jarrod Goodwin | Last update: July 21, 2025Score: 4.8/5 (64 votes)
Does Social Security count as income for Irmaa?
Do Social Security benefits count toward IRMAA? Yes, the taxable portion of your Social Security benefits is used to calculate your MAGI, and MAGI determines your IRMAA.
Is all social security income included in Magi?
MAGI is adjusted gross income (AGI) plus these, if any: untaxed foreign income, non-taxable Social Security benefits, and tax-exempt interest. For many people, MAGI is identical or very close to adjusted gross income. MAGI doesn't include Supplemental Security Income (SSI).
What tax year is 2025 Irmaa based on?
The Social Security Administration (SSA) determines who pays an IRMAA based on the income reported 2 years prior. So, for 2025, the SSA looks at your 2023 tax returns to see if you must pay an IRMAA.
What income is used to determine Medicare premiums in 2024?
We use the most recent federal tax return the IRS provides to us. If you must pay higher premiums, we use a sliding scale to calculate the adjustments. This is based on your "modified adjusted gross income" (MAGI). Your MAGI is your total adjusted gross income and tax-exempt interest income.
What Types of Income is IRMAA Based on? How to Avoid the Medicare Surcharge
How do I get Irmaa reduced?
Fill out the Medicare Income-Related Monthly Adjustment Amount-Life-changing Event (SSA-44) (PDF) form. Fax or mail your completed form and evidence to a Social Security office.
What is the two year rule for Irmaa?
The Social Security Administration (SSA) determines if you owe an IRMAA based on the income you reported on your IRS tax return two years prior, meaning two years before the year when you pay the IRMAA. For example, Social Security would use tax returns from 2024 to determine your IRMAA in 2026.
How to avoid Irmaa surcharges?
- 1.) Charitable Giving.
- 2.) Tax Deductible Retirement Account Contributions.
- 3.) Tax-Free Retirement Income.
- 4.) Tax-Efficient Investments.
- 5.) Tax-Efficient Withdrawal Strategies.
- 6.) Medicare Savings Accounts (MSAs)
- 7.) Roth Conversions.
- 8.) Tax Gain Harvesting.
What income level triggers higher Medicare premiums?
If you earn more than $106,000 ($212,000 if you're married), you pay higher monthly rates for both Medicare Part B and D. Currently insured? It's free, simple and secure. For 2025, your costs for Medicare Parts B and D are based on the income on your 2023 tax return.
How to calculate modified adjusted gross income for Irmaa?
This total is a line item on your annual tax return. Then add in the total of your non-taxable interest – This is usually any municipal bond income. The total of your AGI, plus non-taxable interest, is your MAGI for IRMAA purposes.
Does Social Security count as income?
Your benefits may be taxable if the total of (1) one-half of your benefits, plus (2) all of your other income, including tax-exempt interest, is greater than the base amount for your filing status.
How do I calculate my modified adjusted gross income?
Your MAGI (modified adjusted gross income) is your AGI plus certain deductions you must “add back.” These deductions include IRA contributions, student loan interest, one-half of self-employment tax, qualified tuition expenses, and more.
Does inheritance count toward Irmaa?
Receiving a Windfall: Inheritance, large bonuses, or other windfalls can suddenly spike your income and lead to higher IRMAA charges. Annuity Distributions: Taking distributions from an annuity can also impact your MAGI, affecting your IRMAA in the process.
How much of my Social Security income is taxable in 2024?
To get the most out of your benefit you need to plan carefully, however, since you could owe income taxes on as much as 85% of your Social Security. $45,864: Maximum Social Security benefit for someone retiring at full retirement age in 2024. 85%: Maximum portion of Social Security benefits subject to income taxes.
Do pensions count towards Irmaa?
For IRMAA purposes, a taxpayer's MAGI generally consists of wages, taxable interest, ordinary dividends, taxable IRA distributions, taxable pension payments, taxable Social Security benefits, capital gains, plus tax-exempt interest income.
Does everyone have to pay $170 a month for Medicare?
Most people pay no premiums for Part A. For Medicare Part B in 2025, most beneficiaries will pay $185 per month. Certain factors may require you to pay more or less than the standard Medicare Part B premium in 2025.
How long does Irmaa last?
FAQs in Relation to Is Irmaa Calculated Every Year
The Social Security Administration reviews IRMAA every year, considering your tax returns from two years prior.
How do I get out of paying Irmaa?
If you've experienced a life-changing event, you can ask the Social Security Administration to reduce or eliminate your IRMAA amount by completing and submitting Form SSA-44.
Do 401k contributions reduce Irmaa?
If you are still working and can make tax-deductible contributions to a traditional IRA or traditional 401(k), TSP, 403(b), or 457 plan, you can reduce your taxable income and reduce or avoid IRMAA.
How do some people escape the steep Medicare surcharge on premiums known as Irmaa?
If you get a notice from Social Security saying you owe an IRMAA surcharge, you may be able to eliminate or reduce that fee by showing that your modified adjusted gross income was wrong or by proving you've had one of eight “life-changing events” that lowered your income. They are: Marriage. Divorce or annulment.
How do you appeal Irmaa successfully?
You will use Form SSA-44 (Medicare Income Related Monthly Adjustment Amount – Life Changing Event). Complete the required information on the form and submit to a local Social Security office. Go to our website at www.medicaremindset.com/irmaa for more detailed instructions, as well as to download the appeal form.
What is the Irmaa penalty for 2024?
For 2024, if your income is greater than $103,000 and less than $397,000 the IRMAA amount is $384.30. If income is greater than or equal to $397,000 the IRMAA is $419.30. Medicare Part D. If your income is greater than $103,000 and less than $397,000, the IRMAA amount is $74.20.
What income level triggers Irmaa?
People with Medicare who earn a high income have to pay an IRMAA, an extra charge on Medicare Parts B and D. The fee kicks in if you make more than $106,000 (up from $103,000 in 2024) or if you and your spouse collectively earn over $212,000 (up from $206,000 in 2024).