IRMAA is an income-based surcharge added to your Medicare Part D premium

IRMAA stands for Income-Related Monthly Adjustment Amount. It is an extra charge Medicare adds to your Part D prescription drug premium if your income exceeds a certain threshold. The higher your income, the higher the surcharge — it can double or triple your monthly premium. IRMAA is based on your tax return from two years prior, which means changes to your income now will not affect your IRMAA until two years later.

Medicare uses your modified adjusted gross income (MAGI) to calculate IRMAA, not your total household income. MAGI includes wages, interest, dividends, capital gains, and certain other sources. If you are married and file jointly, both spouses' income counts toward the threshold, even if only one of you is on Medicare.

IRMAA applies to all Medicare beneficiaries with higher incomes — there is no way to avoid it by choosing a different plan type. However, you can request that Medicare recalculate your IRMAA if your income has dropped significantly since the tax year used to set your surcharge.

Key Takeaways

  • IRMAA is an extra monthly charge added to your Part D premium if your income is above the threshold set by Medicare each year.
  • Medicare bases IRMAA on your tax return from two years ago, so a recent drop in income will not lower your surcharge until the following year.
  • You can file a Life-Changing Event form to request a recalculation if you have experienced a major income loss, such as retirement or a spouse's death.
  • IRMAA thresholds change annually, and the surcharge amount varies depending on how far above the threshold your income falls.

How IRMAA thresholds and surcharge amounts work

Medicare sets income thresholds each year, and they differ based on your filing status. For 2024, the thresholds begin at $97,000 for single filers and $194,000 for married couples filing jointly. If your MAGI is at or below these amounts, you pay no IRMAA surcharge. Above these thresholds, Medicare divides beneficiaries into income brackets, and each bracket carries a different surcharge amount.

The surcharge increases in steps as your income rises. For example, someone with income just above the threshold might pay $35 extra per month on top of their standard Part D premium, while someone with much higher income might pay $120 or more. The exact amounts change each year, and they are higher for Part D than for other Medicare premiums.

Your Part D plan premium itself varies by plan and region, so your total monthly cost is the base premium plus the IRMAA surcharge. If you switch to a different Part D plan, the IRMAA amount stays the same — it is tied to your income, not your plan choice.

Which tax year Medicare uses to calculate your IRMAA

Medicare uses your tax return from two years before the current year. In 2024, Medicare is using 2022 tax returns. In 2025, it will use 2023 returns. This two-year lag means that if you retired in 2024 and your income dropped sharply, your 2024 IRMAA will still be based on your 2022 income — the year before you retired.

This delay creates a common problem: beneficiaries often face a higher IRMAA surcharge in the year their income drops, then see it decrease the following year once the lower-income tax return is processed. If the gap is large, you may be able to request an adjustment in the current year by filing a Life-Changing Event form, but you will need to document the income loss.

If you have not yet filed your tax return for the year Medicare will use, make sure to do so. Medicare cannot calculate IRMAA without a filed return on record with the IRS. If you did not file because your income was too low to require it, you may still need to file a return so Medicare has the information it needs.

Life-Changing Events that let you request a recalculation

If your income has dropped significantly since the tax year Medicare is using, you can request that Medicare recalculate your IRMAA by filing a Life-Changing Event form. Medicare recognizes certain events as reasons to update your surcharge in the current year rather than waiting two years. These include retirement, loss of income-producing property, death of a spouse, divorce, and loss of pension or investment income.

To request a recalculation, you will need to contact Social Security (not Medicare directly) and provide documentation of the life-changing event. For retirement, you will need proof of your retirement date and your new income. For a spouse's death, you will need a death certificate. For loss of income, you will need documentation showing the income is no longer available — such as a letter from your employer or proof that an investment account was closed.

Social Security will review your request and, if approved, will adjust your IRMAA effective the month after they receive your form. The process typically takes four to six weeks. If you are denied, you can appeal, though the appeal process is separate and may take longer.

How to find out your current IRMAA amount

Your IRMAA surcharge appears on your Medicare Part D premium bill each month. If you receive your Part D coverage through a standalone prescription drug plan, the surcharge is listed separately from the base premium. If you have a Medicare Advantage plan that includes prescription coverage, the IRMAA may be rolled into your total monthly payment, though it should be itemized in your billing statement.

You can also view your IRMAA amount by logging into your Medicare account at Medicare.gov. Under "Billing and Payments," you will see a breakdown of your premiums, including any IRMAA surcharge. If you do not have an online account, you can call Social Security at 1-800-772-1213 to ask what your current IRMAA is.

If the amount shown seems wrong — for example, if your income has dropped but your IRMAA has not — contact Social Security to request a review. Bring documentation of your current income situation so they can determine whether you may have access to for a Life-Changing Event adjustment.

IRMAA and other Medicare premiums

IRMAA applies not only to Part D but also to Medicare Part B (medical insurance) and Part C (Medicare Advantage). Each has its own surcharge structure and thresholds, though they all use the same two-year-old tax return. If your income is high enough to trigger IRMAA, you will likely pay surcharges on multiple parts of your coverage.

Part B IRMAA surcharges tend to be larger than Part D surcharges for the same income level. Part C plans do not have a separate IRMAA surcharge; instead, the plan premium itself may be higher for beneficiaries with higher incomes, though this varies by plan. Understanding your total IRMAA across all parts of Medicare is important when budgeting for your coverage costs.

If you are considering whether to enroll in Part D, keep in mind that IRMAA will explore regardless of which plan you choose or whether you choose to enroll at all. If you delay Part D enrollment beyond your initial enrollment period, you may face a late enrollment penalty in addition to your regular premium and IRMAA surcharge.

Strategies to manage IRMAA costs

Because IRMAA is based on income from two years ago, some beneficiaries look for ways to reduce their reported income in the years leading up to Medicare enrollment. Common strategies include converting traditional IRA funds to Roth IRAs (which counts as income in the conversion year but reduces future MAGI), timing the sale of investments, or delaying the start of Social Security benefits. These strategies are legal, but they require planning and may have other tax consequences.

Another approach is to review your Part D plan choice each year during the annual enrollment period. While IRMAA stays the same regardless of plan, switching to a plan with a lower base premium can reduce your total monthly cost. Some plans are significantly cheaper than others in the same region, so comparing options may save you money even if your IRMAA surcharge does not change.

If you believe your IRMAA is incorrect or if your financial situation has changed, do not assume you are stuck with the surcharge. Contact Social Security to discuss your options. Even if you do not may have access to for a full recalculation, Social Security can sometimes adjust your IRMAA if there are extenuating circumstances.

Frequently Asked Questions

Can I appeal my IRMAA surcharge if I think it is wrong?

Yes. Contact Social Security at 1-800-772-1213 and ask for a reconsideration. If you believe the income figure Medicare is using is incorrect, bring documentation of your actual income. If your income has dropped due to a life-changing event, file a Life-Changing Event form. Social Security will review your case and may adjust your surcharge.

What happens to my IRMAA if I get married or divorced?

Your IRMAA is recalculated based on your new filing status and combined income (if married). Divorce is a Life-Changing Event, so you can request an when ready recalculation rather than waiting for the next tax year to be processed. Contact Social Security with your divorce decree to start the process.

Do I have to pay IRMAA if I am still working?

Yes. IRMAA is based on your income from your tax return, regardless of whether you are still working. If your current earnings are high, your IRMAA will reflect that income, even if you expect to retire soon. Once you retire, you can request a Life-Changing Event adjustment if your income drops significantly.

Will my IRMAA go down next year if my income dropped this year?

Not automatically. Your IRMAA will be recalculated based on your tax return from two years ago. If your income dropped in 2024, your 2025 IRMAA will still reflect your 2023 income. In 2026, it will be based on your 2024 return, which is when you will see the decrease. If the drop is severe, you can request an when ready adjustment by filing a Life-Changing Event form.

Can I avoid IRMAA by not enrolling in Part D?

IRMAA does not explore if you do not enroll in Part D, but you may face a late enrollment penalty if you enroll later. Additionally, going without prescription coverage can be expensive if you take medications regularly. Weigh the cost of IRMAA against the cost of paying out of pocket for prescriptions before deciding to skip Part D enrollment.