How to avoid IRMAA: what counts, what doesn't, and the 2027 brackets

What IRMAA is, and why it behaves like a cliff

Most Medicare beneficiaries pay about 25% of the cost of Part B. Since 2007, higher-income beneficiaries have paid 35%, 50%, 65%, 80% or 85% instead, and since 2011 the same tiering has applied to Part D. The Social Security Administration calls the extra amount the income-related monthly adjustment amount; it affects roughly 8% of people with Part B.

Two features make it a planning problem. The first is the two-year lookback: Social Security uses the most recent federal return the IRS has passed to it, in practice the return from two years prior. By the time you notice a problem, it is generally two years too late to fix it.

The second is the step structure. This is not a marginal rate applied to the excess. Cross a threshold by a single dollar and you pay the entire step, every month, for the whole year — no phase-in, no proration. Which is why the tactics below are all about landing on the correct side of a specific number.

The confirmed 2026 IRMAA brackets

CMS released the 2026 figures on 14 November 2025. The standard Part B premium is $202.90 a month, up from $185.00, with an annual Part B deductible of $283. The surcharges below sit on top of that standard premium (Part B) and on top of whatever your drug plan charges (Part D). Both are published by CMS.

Married filing separately is treated harshly: if you lived with your spouse at any point in the tax year but filed separately, there are only three tiers — no surcharge at or below $109,000, a jump straight to $446.30 plus $83.30 above that, and the top rate of $487.00 plus $91.00 at $394,000 and above. The middle steps do not exist.

The 2027 IRMAA brackets: what is and isn't known

Be careful here, because this is the most misreported figure in retirement planning content. As of July 2026, the 2027 IRMAA brackets have not been announced. CMS publishes each year's premiums and adjustment amounts in the autumn of the preceding year — the 2026 numbers landed on 14 November 2025 — so the 2027 tables are expected around late October or November 2026. Every "2027 IRMAA bracket" table circulating today is a projection built on assumed inflation, and several of them disagree with each other.

The mechanism, though, can be stated with confidence:

• The income year is 2025 — the return you filed in 2026, already submitted. No planning done now changes it.
• The thresholds are inflation-indexed. The first four brackets move with the CPI-U, which is why the single-filer entry point crept from $106,000 to $109,000 between 2025 and 2026. The top thresholds ($500,000 / $750,000) are fixed in statute and not indexed, so more people drift into the top tier over time.
• The surcharge amounts follow Part B costs, not inflation, and have historically risen faster than the thresholds.

MAGI for IRMAA — is IRMAA based on AGI?

Almost. IRMAA uses modified adjusted gross income, but the modification is a single item. Social Security's definition is short enough to quote: "Your MAGI is your total adjusted gross income and tax-exempt interest income." That is the whole test — AGI plus tax-exempt interest.

Municipal bonds therefore do not help. Tax-exempt interest is added straight back, so a portfolio built around munis offers no IRMAA protection at all — the interest is invisible to the income tax and fully visible to Medicare.

Anything that never reaches AGI is genuinely free. Qualified Roth withdrawals, the return of basis from a taxable account, and HSA distributions for qualified expenses do not appear in AGI and so do not appear in IRMAA MAGI. That is the structural reason the Roth side of a plan is worth more than its headline tax rate suggests — mechanics in the withdrawals and taxes guide.

Items that do count, and that people forget: capital gains, the taxable portion of Social Security, RMDs, pension and annuity income, rental income, and Roth conversions. A single realisation event — selling a rental, exercising options, a business sale — can put you in the top tier for exactly one year.

Roth conversions and IRMAA: the two-year echo

A Roth conversion is ordinary income. It enters AGI in full, counts toward IRMAA MAGI dollar for dollar, and echoes into your Medicare premiums two years later. Convert $80,000 in 2026 on top of $150,000 of other income as a married couple and you may have moved a tier — a cost that surfaces in your 2028 premiums, long after the conversion feels like settled history. It is a trade-off, though, not a mistake. Three things keep it in proportion:

• The surcharge is a one-year event. IRMAA is redetermined annually, so a conversion year raises premiums once and then resets. A toll, not a permanent rate increase.
• The converted money is permanently outside the test. Future qualified Roth withdrawals are invisible to IRMAA, and the conversion shrinks the traditional balance that would otherwise have generated RMDs — themselves a leading cause of IRMAA in the 70s and 80s.
• The cost is usually small relative to the tax saved — even a two-tier jump for a couple runs a few thousand dollars for one year.

The sequencing conclusion: convert hardest before Medicare age. Conversions in your early sixties — the window between stopping work and starting Social Security and RMDs — carry no IRMAA cost at all, because there is no Medicare premium to surcharge. From 63 onward, every conversion year is also an IRMAA year. The IRMAA calculator shows your current tier, your headroom to the next cliff, and the largest conversion that stays under it; the Roth conversion calculator models the cost of a conversion path across a full retirement; and the advanced strategies guide covers the deduction-offset techniques that let larger conversions happen without an equivalent spike in AGI.

One refinement: if you are crossing a threshold anyway, cross it decisively. Having accepted the step, income up to the next threshold is surcharge-free.

How to avoid IRMAA: the tactics that work

Ranked roughly by how much they move the needle for a typical high-balance retiree.

• Convert before 63. Income recognised before your first Medicare-relevant lookback year carries no surcharge risk at all.
• Use QCDs once you are 70½. A qualified charitable distribution — up to $111,000 per person in 2026 — satisfies your RMD while staying out of AGI entirely. Unlike a charitable deduction, which does nothing for IRMAA, a QCD reduces the measured income directly. For a charitably inclined retiree already taking RMDs, it is the cleanest lever available.
• Know your distance to the next threshold before December. Estimate MAGI in the autumn, while you still control the last decisions of the year — whether to realise a gain, whether to take a discretionary distribution.
• Harvest losses and spread gains. A large sale can often be split across two tax years, or partly offset with realised losses, to keep each year inside a tier.
• Draw from the right account. Roth withdrawals and taxable-account basis fund spending without touching MAGI. Close to a line, the source of your cash flow matters as much as the amount.
• Stop assuming munis protect you. If IRMAA is the binding constraint, the muni allocation is not doing the job you think it is.
• Delay Social Security if it fits the wider plan. Deferring keeps taxable benefits out of MAGI during the conversion years — though longevity and survivor economics should drive that decision first.
• Review filing status. Married filing separately triggers the compressed three-tier scale above.

For the withdrawal-order framework these tactics sit inside, see the retirement withdrawals and taxes guide, or start from the Learn hub, where the pillar guides run from the basics through to the advanced work.

The cliff effect, quantified

Take a single filer whose 2024 MAGI was $109,001 — a dollar over the first 2026 threshold. That dollar bought an $81.20 monthly Part B surcharge and a $14.50 Part D surcharge: $95.70 a month, or $1,148.40 across 2026. A couple with both spouses enrolled pays each surcharge twice: $2,296.80 for being one dollar over. At the top of the scale, a single filer at or above $500,000 pays $487.00 plus $91.00 a month — $6,936 for the year, or $13,872 for a couple.

Which is why the last hundred dollars of income in December can be the most expensive of the year, and why "how far am I from the line?" is a better planning question than "what is my tax bracket?"

When you can't avoid it: appealing with SSA-44

If the two-year-old return no longer reflects reality, you are not stuck with it. Social Security will use your estimated current income instead, provided the change traces to a recognised life-changing event: marriage, divorce or annulment, death of a spouse, you or your spouse stopping work or reducing hours, loss of income-producing property beyond your control, termination or reorganisation of an employer's pension plan, or an employer settlement following closure, bankruptcy or reorganisation.

Retirement is the common one: someone who worked through 2025 at a full salary and retired in 2026 will otherwise pay 2027 premiums on an income they no longer have. The remedy is Form SSA-44, filed with documentation of the event and an estimate of the reduced income.

Note what is not a life-changing event: a voluntary spike. A large Roth conversion, a property sale or an exercised option produced a high MAGI by choice, and SSA-44 will not undo it. If the underlying data is simply wrong — an amended return, an IRS transcription error — that is handled separately, by informing Social Security or filing Form SSA-561-U2. We cover the form line by line in the companion guide to appealing IRMAA with Form SSA-44.