By Christian BrinkleyLicensed NC Insurance Agent, NPN 22217190, NC Life & Health · Updated October 14, 2026 · 4 min read
If you have a higher income, you may pay more for Medicare Part B and Part D than the standard amounts. That extra charge is called IRMAA, the Income Related Monthly Adjustment Amount. It is not a penalty. It is a surcharge based on your income from two years ago. IRMAA surprises a lot of people. A letter arrives from Social Security saying your Part B premium is higher than expected, and you are not sure why. Here is how it works, how it is calculated, and what to do if your income has dropped.
What Is IRMAA?
IRMAA is an extra amount added to your monthly Part B premium and your monthly Part D premium when your income is above a set threshold. Most people pay the standard Part B premium and their plan premium for Part D. People with higher incomes pay the standard amounts plus IRMAA.
How IRMAA Is Calculated
Social Security decides whether you owe IRMAA based on your Modified Adjusted Gross Income, or MAGI, from two years ago. Your 2026 IRMAA is based on your 2024 tax return. MAGI is your adjusted gross income plus any tax exempt interest you reported.
Social Security gets your income from the IRS. You do not report it yourself. If your income is above the threshold for your filing status, you owe IRMAA.
What Counts as Income?
MAGI includes wages, taxable Social Security benefits, pension income, withdrawals from traditional retirement accounts, capital gains, rental income, and other taxable income, plus tax exempt interest such as municipal bond interest. Qualified Roth IRA withdrawals generally do not count as taxable income. This is not tax advice. Talk to a tax professional about your situation.
How Much Is IRMAA?
Exact IRMAA amounts change every year. Medicare publishes new Part B and Part D IRMAA tables each fall for the coming year, and your Social Security notice shows your exact amount.
In general, the lowest tier adds a modest amount to Part B and a small amount to Part D. The highest tier adds much more. The gap between tiers can be hundreds of dollars per month for Part B alone.
Appealing After a Life Changing Event
If your income has fallen since the tax year Social Security used, you may be able to appeal based on a life changing event. Social Security defines specific qualifying events.
When Income Goes Up and Down
Because of the two year lag, timing matters. Before a large withdrawal, property sale, or Roth conversion, talk to a tax professional about the IRMAA effect two years later.
Tips for Managing IRMAA
Keep your tax returns and Social Security notices. When an IRMAA notice arrives, compare the income year and amount to your actual return. Mistakes are rare but happen.
If you are married, remember IRMAA uses joint income when you file jointly. Filing separately has its own thresholds and is not always better. Talk to a tax professional before changing filing status.
Getting Help
Start with Social Security at 1-800-772-1213 or your local office, or check your notice at ssa.gov. For how IRMAA affects Medicare premiums, call 1-800-MEDICARE. Your state SHIP program offers free help with IRMAA and appeals. In North Carolina, it is called SHIIP.
This article is general information only. It is not tax advice or personal advice. Check your own notice and talk to a tax professional about your situation.
Questions people ask me about this
What is IRMAA?
IRMAA is an extra amount added to your monthly Part B premium and your monthly Part D premium when your income is above a set threshold. Most people pay the standard Part B premium and their plan premium for Part D. People with higher incomes pay the standard amounts plus IRMAA. IRMAA applies to Part B and Part D separately.
How is IRMAA calculated?
Social Security decides whether you owe IRMAA based on your Modified Adjusted Gross Income, or MAGI, from two years ago. Your 2026 IRMAA is based on your 2024 tax return. MAGI is your adjusted gross income plus any tax exempt interest you reported. Social Security gets your income from the IRS. You do not report it yourself.
What counts as income?
MAGI includes wages, taxable Social Security benefits, pension income, withdrawals from traditional retirement accounts, capital gains, rental income, and other taxable income, plus tax exempt interest such as municipal bond interest. Qualified Roth IRA withdrawals generally do not count as taxable income. This is not tax advice.
How much is IRMAA?
Exact IRMAA amounts change every year. Medicare publishes new Part B and Part D IRMAA tables each fall for the coming year, and your Social Security notice shows your exact amount. In general, the lowest tier adds a modest amount to Part B and a small amount to Part D. The highest tier adds much more.
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