Medicare Part B IRMAA is an extra charge added to your standard Part B premium if your income exceeds a certain threshold. IRMAA stands for Income-Related Monthly Adjustment Amount, and it essentially means higher-income Medicare beneficiaries pay more for their medical insurance coverage. For 2025, the surcharge kicks in if your modified adjusted gross income tops $106,000 as an individual or $212,000 as a married couple filing jointly.
How IRMAA Changes Your Premium
Most Part B beneficiaries pay about 25% of the true cost of their coverage. That’s the standard premium: $185.00 per month in 2025. IRMAA increases the share you pay based on five income tiers, ranging from 35% of the true cost at the lowest surcharge level up to 85% at the highest. The surcharge is added on top of the standard premium, so your total monthly bill is the base premium plus whatever IRMAA amount applies to your income bracket.
For 2025, here’s what each tier looks like for individual filers:
- $106,000 or below: No surcharge. You pay the standard $185.00.
- $106,001 to $133,000: $74.00 surcharge, totaling $259.00 per month.
- $133,001 to $167,000: $185.00 surcharge, totaling $370.00 per month.
- $167,001 to $200,000: $295.90 surcharge, totaling $480.90 per month.
- $200,001 to $499,999: $406.90 surcharge, totaling $591.90 per month.
- $500,000 or above: $443.90 surcharge, totaling $628.90 per month.
For married couples filing jointly, the thresholds are exactly double the individual amounts: $212,000, $266,000, $334,000, $400,000, and $750,000. Married people who file separately face a much steeper penalty. If you lived with your spouse at any point during the year and file separately, you jump straight to the $406.90 surcharge once your income exceeds $106,000, with no intermediate tiers in between.
The Two-Year Look-Back
One detail that catches many people off guard: IRMAA is based on your tax return from two years ago, not your current income. If you’re paying premiums in 2025, Social Security is looking at your 2023 tax return. For 2026 premiums, it’s your 2024 return. This lag exists because the most recent finalized tax data the IRS has available is always from two years prior.
This matters most for people who recently retired or had a one-time income spike. You might be living on a fraction of your former salary, but if your income was high two years ago, you’ll still owe the surcharge now. There is a way to address this, covered below.
What Counts as Income
The income figure Social Security uses isn’t your total earnings or your taxable income. It’s your modified adjusted gross income, which is your adjusted gross income (line 11 on your 1040) plus any tax-exempt interest income (line 2a). That second piece is important: if you hold municipal bonds or other investments that generate tax-free interest, that income still counts toward your IRMAA calculation even though you don’t owe federal taxes on it.
Capital gains from selling a home or investments, Roth conversions, pension income, rental income, and Social Security benefits that are included in your AGI all factor in. A large Roth conversion in a single year, for example, can push you into a higher IRMAA bracket two years later.
IRMAA Applies to Part D Too
The surcharge isn’t limited to Part B. If you have Medicare prescription drug coverage (Part D), you’ll also pay an IRMAA on that plan. The same income brackets apply, but the dollar amounts are smaller. For 2026, the Part D surcharge ranges from $14.50 per month at the lowest tier to $91.00 at the highest. If you carry both Part B and Part D, you pay a separate surcharge on each one.
How You’re Notified and How You Pay
Social Security sends you a notice called the Initial IRMAA Determination when it decides you owe the surcharge. There’s no fixed month when these letters go out; you can receive one at any time. The letter will show your income bracket, the surcharge amount, and your total monthly premium.
For most beneficiaries, the surcharge is deducted directly from your Social Security check along with your standard Part B premium. If you’re not yet collecting Social Security benefits, you’ll be billed directly.
Requesting a Reduction After a Life Change
If your income has dropped significantly since the tax year being used, you can ask Social Security to base your IRMAA on your more recent, lower income instead. Qualifying life-changing events include retirement or other loss of income, marriage, divorce, the death of a spouse, and an employer settlement payment.
You’ll need to contact Social Security and provide documentation of the event and your reduced income. Simply having a bad investment year or lower capital gains doesn’t qualify. The event needs to fall into one of those specific categories. If approved, your surcharge will be recalculated based on your current or more recent income, which can save you hundreds of dollars per month.
Strategies That Affect Your Bracket
Because IRMAA is tied directly to your modified adjusted gross income, the decisions you make about withdrawals, conversions, and investment income in any given year can ripple forward into your Medicare costs two years later. Spreading a large Roth conversion across multiple years rather than doing it all at once, for instance, may keep you in a lower bracket. Timing the sale of appreciated assets, managing rental income, and being aware of how tax-exempt interest counts can all influence which tier you land in.
It’s also worth noting that the brackets are hard cutoffs, not gradual phase-ins. Earning one dollar over a threshold bumps you into the next tier for the entire year. At the jump from no surcharge to the first tier, that single dollar of income costs you $74.00 per month, or $888 over the year, in additional Part B premiums alone.