This post about IRMAA Brackets for 2024. As we approach the end of another year, it’s essential for Medicare beneficiaries to understand the income-related monthly adjustment amount (IRMAA) and its impact on Medicare premiums. IRMAA is an additional fee that certain high-income individuals and couples must pay on top of their regular Medicare Part B and Part D premiums.
In this post, we’ll delve into what IRMAA is, the income brackets for 2024, how the premiums are calculated, strategies for managing IRMAA, and more.
For the 2023 thresholds, see our post on IRMAA Brackets for 2023.
Table of Contents:
- What Are IRMAA Brackets?
- IRMAA Brackets for 2024
- How to Calculate IRMAA Premiums
- Strategies for Managing IRMAA
- How to appeal the IRMAA
- IRMAA Brackets FAQs
What Are IRMAA Brackets?
IRMAA, or the income-related monthly adjustment amount, is a surcharge that applies to Medicare beneficiaries with higher incomes.
If your income exceeds certain thresholds, you’ll be subject to additional monthly premiums on your Medicare Part B and Part D coverage.
This surcharge is calculated based on a sliding scale, and it’s intended to help support the financial stability of the Medicare program.
What are the IRMAA Brackets for 2024
First, it is important to note that the official IRMAA Brackets for 2024 have not yet been released.
However, by law, the IRMAA Brackets adjust according to the Consumer Price Index for Urban Consumers (CPI-U).
From 2022 to 2023 the CPI-U, if inflation remains constant, will increase by 5.65%.
This means that the IRMAA Brackets, by law, will increase at the same rate.
Here are the possible 2024 IRMAA Brackets (not official)
2024 IRMAA Thresholds if CPI-U remains constant and legislation is not passed by Congress.
You can compare this to the 2023 numbers.
| Individual | Couple | Part B | Part D |
|---|---|---|---|
| $102,500 | $205,000 | $174.80 | Premium (varies) |
| $102,500 – $130,000 | $205,000 -$260,000 | $244.70 | Premium + $12.90 |
| $130,000 – $162,000 | $260,000 – $324,000 | $349.60 | Premium + $33.30 |
| $162,000 – $193,500 | $324,000 – $387,000 | $454.40 | Premium + $53.80 |
| $193,500 – $500,000 | $387,000 – $500,000 | $559.20 | Premium + $74.20 |
| > $500,000 | > $750,000 | $594.20 | Premium + $81.00 |
How to Calculate IRMAA Premiums
The IRMAA premium calculation is based on your modified adjusted gross income (MAGI) from two years prior.
MAGI is not the same as your regular adjusted gross income (AGI); it includes additional sources of income like tax-exempt interest and certain foreign income.
The higher your MAGI falls within the income brackets, the higher your IRMAA surcharge will be.
Medicare Part B and Part D IRMAA surcharges are added on top of your standard premiums, which can significantly impact your overall Medicare costs.
For example, if you have a 2021 income of $200,000 as an individual, you’d fall into the highest Part B IRMAA bracket and pay an extra $395.60 per month, totaling $560.50 including the standard Part B premium.
Strategies for Managing IRMAA
There are strategies you can consider to manage or minimize your IRMAA surcharges:
- Tax Planning: Work with a tax professional to explore ways to reduce your MAGI through strategies like tax-efficient investments, deductions, and contributions to tax-advantaged retirement accounts.
- Roth Conversions: If you’re eligible, consider converting traditional retirement accounts to Roth accounts. While this may result in a tax bill now, it can help reduce your future MAGI and IRMAA.
- Charitable Contributions: Some charitable contributions can lower your taxable income and subsequently your MAGI. However, not all contributions will affect your MAGI.
- Qualified Charitable Distributions (QCDs): If you’re 70½ or older, QCDs allow you to donate your required minimum distributions (RMDs) directly to qualified nonprofits, reducing your MAGI.
How to appeal the IRMAA
If you believe that your IRMAA determination is incorrect due to errors in your tax return or significant life changes, you have the right to appeal.
You can contact the Social Security Administration to request a reconsideration of your IRMAA status.
Some qualifying events for appeals include marriage, divorce, work stoppage, loss of income, and more.
IRMAA Brackets FAQs
Here are the most frequently asked questions about IRMAA Brackets for 2024:
Is IRMAA Calculated Every Year?
Absolutely, IRMAA is recalculated annually.
Your IRMAA amount hinges on your modified adjusted gross income (MAGI) from two years prior.
This means that each year, your MAGI from two years ago is used to determine whether you’ll fall within an IRMAA bracket.
Can You Appeal the Medicare IRMAA?
Certainly! If the Social Security Administration (SSA) has determined that you’re subject to the Medicare IRMAA, you can appeal.
This is particularly relevant if you’ve experienced a life-changing event that may have affected your income.
Examples include marriage, divorce, loss of work, or receipt of settlement payment due to certain circumstances.
If you didn’t experience such an event, you can still appeal.
Do You Pay IRMAA If You Have a Medicare Advantage Plan?
Yes, if your income meets the threshold, you’ll pay IRMAA even if you have a Medicare Advantage plan.
Enrolling in Part B is a prerequisite for Medicare Advantage eligibility, and if your income exceeds the threshold, the IRMAA adjustment is applicable.
How to Pay the Medicare IRMAA Surcharge
If you’re already receiving Social Security benefits, paying the Medicare IRMAA surcharge is straightforward – it’s automatically deducted from your Social Security payments.
However, if you’re not collecting Social Security, you’ll receive a bill for the surcharge from the government.
What is IRMAA?
IRMAA, or Income-Related Monthly Adjustment Amount, is an additional charge on Medicare premiums for Part B and Part D plans.
It’s calculated based on your income and is tiered according to income brackets.
The higher your income, the higher your IRMAA surcharge.
Can IRMAA Impact My Medicare Part B Premium?
Yes, if your income exceeds a certain threshold, you’ll be subject to IRMAA and it will impact your Medicare Part B premium.
The impact varies depending on your income bracket and the standard premium.
How Do I Calculate IRMAA?
Calculating IRMAA involves looking at your modified adjusted gross income from your tax return submitted to the IRS two years prior.
Your IRMAA amount is determined based on this income.
How to Appeal the IRMAA Decision
You have the right to appeal an IRMAA determination.
If you believe the information used to calculate your IRMAA is outdated or incorrect, you can request a reconsideration.
Documenting your case with supporting evidence is crucial during this process.
IRMAA Brackets for 2024 Summary
We hope this post on IRMAA Brackets for 2024 was helpful.
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Finally, be sure to check out our other articles about Social Security and Disability Benefits, including:
