Most people know that Medicare has standard premiums. What catches higher earners off guard is that those standard premiums are not universal -- once your income crosses certain thresholds, you pay significantly more. This surcharge is called IRMAA, which stands for Income-Related Monthly Adjustment Amount, and it applies to both Part B and Part D premiums.

How IRMAA Works

IRMAA is a sliding-scale surcharge added to your Medicare premiums based on your Modified Adjusted Gross Income (MAGI) from two years prior. So your 2026 Medicare premiums are determined by your 2024 tax return.

Medicare uses your tax return because it is the most recent verified income data available. Social Security administers IRMAA and notifies you of any surcharge each fall before the new year begins.

Part B IRMAA Brackets for 2026

The standard Part B premium in 2026 is approximately $185 per month. Here is how it increases with income:

At the highest tier, a married couple could be paying over $1,250 per month just for Part B premiums.

Part D IRMAA

Part D also has income-related surcharges that use the same income brackets. The surcharge ranges from about $13 to $81 per month added on top of your plan's regular premium depending on your income tier.

The Two-Year Look-Back Problem

Because IRMAA uses income from two years ago, retirement can create a confusing situation. If you retired in 2024 but had high income that year from selling a business, exercising stock options, or receiving a large distribution, your 2026 Medicare premiums will reflect that 2024 income even if your current income is much lower.

This is where knowing your appeal rights matters.

How to Appeal IRMAA

If your income has significantly decreased since the year Medicare is using to calculate your premium -- because of retirement, loss of income-producing property, divorce, or the death of a spouse -- you can request a new initial determination using your more recent income. This is called an IRMAA Life-Changing Event appeal.

The qualifying life-changing events include: marriage, divorce, death of a spouse, work stoppage, work reduction, loss of income-producing property, or loss of pension income. You file Form SSA-44 with the Social Security Administration and provide documentation of the income change.

This appeal is worth doing. If your income genuinely dropped due to retirement, for example, you should not be paying the highest IRMAA tier based on your last year of employment income.

Tax Planning and IRMAA

For people approaching Medicare eligibility, IRMAA is a real reason to pay attention to the timing of income events. Large Roth conversions, capital gains realizations, or required minimum distribution strategies can push income over IRMAA thresholds in a way that significantly increases Medicare costs two years later. Working with a financial advisor or CPA who understands Medicare in the context of retirement income planning can help you manage these trade-offs.

Bottom Line

IRMAA can add hundreds of dollars per month to your Medicare premiums if your income was above the thresholds two years prior. If your income has dropped significantly due to retirement or other life changes, appeal using Form SSA-44. For pre-retirees, consider IRMAA thresholds when planning large income events in the years just before Medicare enrollment.

Disclaimer: The information on this site is for educational purposes only and does not constitute legal, financial, or medical advice. Medicare rules and costs change annually. Always verify current information at Medicare.gov or by calling 1-800-MEDICARE. Consider consulting a licensed insurance professional or your State Health Insurance Assistance Program (SHIP) for personalized guidance.