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IRMAA is the surcharge Medicare adds to your Part B and Part D premiums when your income passes a set line. For 2026, the line is a modified adjusted gross income above $109,000 for single filers and $218,000 for married couples filing jointly, measured on your 2024 tax return. The surcharge itself is not the trap. The trap is that a single high-income year in your early sixties, often the year you sell a business, convert a chunk of an IRA to a Roth account, or take a large capital gain, sets your Medicare premiums two years later, at exactly the moment you have stopped earning.
This guide explains how retirement income decisions feed the surcharge, where the cliffs sit in 2026, and the planning moves that keep a temporary income spike from becoming a recurring premium bill.
The 2026 brackets, and why a dollar matters
CMS set the 2026 standard Part B premium at $202.90 a month. With IRMAA, the premium steps up through five tiers:
- First tier: $284.10 a month for Part B, plus $14.50 on Part D
- Second tier: $405.80 a month, plus $37.50 on Part D
- Third tier: $527.50 a month, plus $60.40 on Part D
- Fourth tier: $649.20 a month, plus $83.30 on Part D
- Top tier: $689.90 a month, plus $91.00 on Part D
Unlike tax brackets, IRMAA tiers are not marginal. Crossing a threshold by one dollar moves your entire premium to the next tier. A couple filing jointly with income of $218,001 in 2024 pays the first-tier surcharge for both spouses in 2026 if both are on Medicare. That is $95.70 extra per person per month once the Part D amount is included, or $2,296.80 for the couple over the year, caused by one dollar of income two years earlier. Our reference guide to Medicare IRMAA surcharges in 2026 has the complete table for every filing status, including the compressed brackets for married filing separately.
Where retirement income spikes come from
Modified adjusted gross income for IRMAA is your adjusted gross income plus tax-exempt interest. In retirement, the usual sources of a spike are predictable. Required minimum distributions from traditional retirement accounts begin in your seventies and can push income up just as other earnings stop. Roth conversions add the converted amount to taxable income in the year of the conversion. Selling a home can add a capital gain above the exclusion limits, and selling investments, a rental property, or a business can add much more. A year of deferred compensation paying out, or a final year of work overlapping with a pension start, stacks income in the same way.
None of these are mistakes in themselves. A Roth conversion that triggers one year of first-tier IRMAA can still be the right move across a retirement. The failure mode is being surprised: doing the conversion at 63, then opening a Social Security letter at 65 that prices your Part B premium at $405.80 a month based on income you no longer have.
Planning around the two-year lookback
Because the lookback is two years, the window for action is earlier than people expect. Your income at 63 sets your first Medicare premiums at 65. Conversions and asset sales done at 60 or 61 never touch your Medicare premiums at all. Spreading a large conversion across two or three tax years can keep each year under a threshold instead of concentrating the gain in one year that lands in a high tier. Timing a property sale for a year when other income is low has the same effect.
Charitable strategies help some households. Qualified charitable distributions from an IRA after age 70 and a half go directly to charity and never enter your adjusted gross income, which makes them a cleaner way to give than taking a distribution and donating cash. Donating appreciated stock avoids realizing the gain at all. These moves need to fit your actual tax picture, so model them with a tax professional before the year ends, not after the return is filed.
When your income has already dropped
If the tax return behind your surcharge no longer reflects your life, you can ask Social Security to recalculate. Retirement or reduced work hours, marriage, divorce, the death of a spouse, and the loss of income-producing property are recognized life-changing events. You file form SSA-44 with documentation of the event and your more recent income, and if Social Security agrees, the surcharge is reduced or removed for that year. The appeal route cannot fix a year where your income genuinely was high and nothing changed. That distinction is covered in detail in our IRMAA appeal guide.
Putting IRMAA in the budget
About 8% of Part B enrollees pay an IRMAA surcharge in a given year according to CMS, and the share rises among people retiring with substantial savings. If your retirement plan includes large distributions, conversions, or asset sales, budget your Medicare premiums at a tier above standard for the affected years and check the estimate every fall when CMS publishes new amounts. The premium table in our guide to Medicare Part B premiums in 2026 is the starting point, and our Medicare retirement budget guide shows where IRMAA sits inside the full yearly total.
