Understanding IRMAA: What You Need to Know for 2025
The Income-Related Monthly Adjustment Amount (IRMAA) is an additional charge that some Medicare beneficiaries must pay on top of their standard Part B and Part D premiums. This surcharge is based on your Modified Adjusted Gross Income (MAGI) from two years prior. For 2025, the IRMAA will be determined by your 2023 income.
How IRMAA Works
The IRMAA applies to individuals whose income exceeds certain thresholds. The surcharge is added to your Part B and Part D premiums, which can significantly increase the cost of Medicare if your income is above the specified limits.
2025 IRMAA Income Brackets
The following table outlines the income thresholds and corresponding IRMAA surcharges for Part B and Part D in 2025:
Income (Single)Income (Married, Joint)Part B IRMAAPart D IRMAA≤ $106,000≤ $212,000$0.00$0.00$106,001 – $133,000$212,001 – $266,000$74.00$13.70$133,001 – $167,000$266,001 – $334,000$185.00$35.30$167,001 – $200,000$334,001 – $400,000$295.90$57.00$200,001 – $500,000$400,001 – $750,000$406.90$78.60≥ $500,000≥ $750,000$443.90$85.80
For individuals who file separately, the IRMAA surcharges are higher for incomes exceeding $106,000.
What Counts Toward IRMAA?
The IRMAA surcharge is based on your MAGI, which includes:
Adjusted Gross Income (AGI) from your tax return
Tax-exempt income, such as interest from municipal bonds or income from U.S. territories
Other non-taxable income, like certain foreign earnings
A Roth IRA conversion does not count toward MAGI, so strategically timing Roth conversions could help minimize or avoid the IRMAA surcharge.
How to Lower or Avoid IRMAA
To reduce the impact of IRMAA:
Plan Roth IRA conversions carefully: Converting large amounts of retirement savings to a Roth IRA in one year can push your income above the IRMAA threshold. Spreading conversions over several years may help mitigate this effect.
Appeal IRMAA determinations: If your income increased due to a one-time event, such as the sale of a home or an inheritance, you can appeal the IRMAA surcharge by requesting a redetermination from Social Security. Use the actual SSA-44 Form
Paying IRMAA
The Part B IRMAA is automatically added to your Medicare Part B premium, while the Part D IRMAA is billed separately. Both surcharges are paid directly to Medicare.
You can pay your Medicare premiums in the following ways:
Online through your Medicare account (the fastest option).
Medicare Easy Pay, which automatically deducts premiums from your bank account.
By mail with check, money order, or credit/debit card.
Bank’s online bill payment service.
Receiving Notification of IRMAA
If you are subject to IRMAA, the Social Security Administration (SSA) will send you a notice. If your financial situation has changed due to a life-changing event (e.g., the death of a spouse), you can request a redetermination to lower or eliminate the surcharge.
Conclusion
The IRMAA surcharge can significantly increase your Medicare costs if your income exceeds certain thresholds. The surcharge is based on your 2023 income for 2025, and the amount depends on your MAGI. Planning your income carefully, including the timing of Roth IRA conversions, can help reduce or avoid IRMAA. If your income spikes due to a one-time event, you may be able to appeal the surcharge with the Social Security Administration.use SSA-44 form
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