Social Security – IRMAA
I wonder if you could discuss the IRMAA “cliff” that folks can run afoul of, and how to avoid it.
Terry Says
Well, you can’t really avoid IRMAA — the “income related monthly adjustment account” — the additional amount you pay for Medicare Part B and D premiums, based on your income from the return you filed TWO years ago!
Read this article for a complete explanation and the levels of income (which change yearly) that trigger the IRMAA: https://www.nerdwallet.com/article/insurance/medicare/what-is-the-medicare-irmaa
Basically, it applies only to Medicare beneficiaries who have a modified adjusted gross income above $97,000 ($103,000 in 2024) for an individual return and $194,000 ($206,000 in 2024) for a joint return.
Of course, if your income declines in future years because of retirement, you can request an adjustment of that additional Medicare Premium (which applies whether you have traditional medicare or Advantage).
As for doing something — well, you can be aware of those income levels, and the things you can do to make sure if you’re going to exceed them, you do it all in one year! That is, schedule a Roth conversion or cash in savings bonds all in the year where you’re already being hit with IRMAA.
