IRMAA stands for Income-Related Monthly Adjustment Amount. It's an extra charge added on top of your standard Medicare Part B premium and your Part D premium if your income is above a certain threshold. Social Security determines whether you owe IRMAA, and it's not based on your current income — it's based on your Modified Adjusted Gross Income (MAGI) from your tax return filed two years earlier. So your 2025 IRMAA is based on your 2023 tax return.
MAGI, for IRMAA purposes, is your Adjusted Gross Income plus tax-exempt interest income. It includes wages, self-employment income, dividends, capital gains, taxable Social Security benefits, pension and retirement account withdrawals, and rental income. Social Security pulls this figure directly from the IRS, so you don't have to report it separately.
Once your MAGI is known, it's compared against a series of income brackets published by Medicare each year. There are typically five or six tiers above the base amount, and each tier adds a progressively larger surcharge to both Part B and Part D. The brackets are different for single filers versus married couples filing jointly, and there's a separate, narrower set of brackets for people who are married but file separate tax returns. Crossing into a higher bracket by even one dollar bumps you into that tier's full surcharge — the increase isn't phased in gradually.
The surcharge is added to your monthly Part B premium bill and, if you have a Part D plan, is billed separately (usually deducted from your Social Security check if you receive benefits) even though it isn't paid to your Part D plan directly. If you're in a Medicare Advantage plan that includes drug coverage, you can still owe the Part D portion of IRMAA even though your premium may otherwise be low or zero.
If your income has dropped since the tax year Social Security is using — because of retirement, divorce, the death of a spouse, or another documented life-changing event — you can request a reconsideration using Form SSA-44. This lets Social Security use a more recent estimate of your income instead of the two-year-old tax return, which can lower or eliminate the surcharge. You typically need documentation of the life event and your revised income estimate.
You'll receive a notice from Social Security each year if you're subject to IRMAA, explaining which bracket applies and how the amount was calculated. If you disagree with the income figure used, you can also request that Social Security verify it with the IRS or use a more recent tax return if one is available and shows lower income. Because IRMAA can add a meaningful amount to your monthly costs, it's worth reviewing your notice carefully and, for complex situations, consulting a tax professional or a Medicare counselor (such as your State Health Insurance Assistance Program) before assuming the charge is correct.