What’s IRMAA?
IRMAA stands for Income-related Monthly Adjustment Rate, and it is a monthly surcharge levied on high-income retirees as an adjustment to the fee they pay for Medicare Parts B and D coverage.Who has to pay IRMAA?
Medicare beneficiaries who earn more than $85,000 for individuals or $170,000 for 
married couples are forced to pay an additional income-related surcharge.
How Bad is It?
Most Medicare Part B recipients pay a monthly premium (which was $134 per month this year and increases to $135.50 in 2019.) However, high-income individuals will pay an additional monthly surcharge ranging between $54.10 and $325.00 per month.
Beginning in 2019 “Very high income” individuals, defined as those whose Modified Adjusted Gross Income is $500,000 for individuals or $750,000 for couples, will pay an additional surcharge, as detailed below:
|
TAX FILING STATUS 2017 |
TAX FILING STATUS 2017 |
TAX FILING STATUS 2017 |
YOU PAY IN 2019 |
|
Individual |
Married, Joint |
Married, Separate |
Premium + IRMAA |
|
$85,000 or less |
$170,000 or less |
$85,000 or less |
$135.50 |
|
$85,001 – $107,000 |
$170,001-$214,000 |
N/A |
$189.60 |
|
$107,001- $133,500 |
$214,001 – $267,000 |
N/A |
$270.90 |
|
$133,501 – $160,000 |
$267,001 – $320,000 |
N/A |
$352.20 |
|
$160,001 – $500,000 |
$320,001 – $750,000 |
$85,001 – $415,000 |
$460.50 |
|
>$500,000 |
>$750,000 |
>$415,000 |
$460.50 |
In addition to these fees, many elect to purchase supplemental “Medigap” coverage to cover deductibles and co-pays that can cost a couple as much as $7,800 per year.
Can I Appeal?
In some cases, individuals can appeal the surcharge on the basis of having a life-changing event which has had a significant impact in their income. One can also appeal if they can demonstrate the information Social Security used to calculate their income was in error.
The Social Security Administration considers the following to be life-changing event(s):
- Death of a spouse
- Marriage
- Divorce
- Reduced work hours
- Loss of income-producing property due to natural disaster
- Loss of Pension
The Social Security Administration does not consider a one-time boost of income such as the sale of a vacation home or a distribution taken from a Roth IRA to be a life-changing events.
If you are currently collecting Social Security benefits, you can expect to receive notifications in December informing you of your new premium amount for the coming year. As always, if you have any questions please feel free to contact your Zinner tax specialist.
