2026 IRMAA Brackets: What Higher Earners Pay for Medicare

Andrew Weber is a senior director of Planning Philosophy, Research, and Guidance at Northwestern Mutual.

Even with Medicare, healthcare costs can add up fast in retirement. And if your income is above a certain amount, you might have to pay even more for certain types of Medicare coverage, including Medicare Part B and Part D.

This fee, called the income-related monthly adjustment amount (IRMAA), is tacked onto your Medicare premiums and withheld from any Social Security benefit—and can ultimately impact your retirement spending. So, it’s important to understand what IRMAA is and how it works.

What is IRMAA?

When you reach age 65, you’re eligible to enroll in Medicare health insurance. With this federal health insurance program, your healthcare coverage comes with a subsidy: Your premiums are generally offset by payments made by all the people who are working and paying into Medicare.

But if your modified adjusted gross income (MAGI) exceeds a certain amount, you may no longer be eligible for this subsidy, and you’d be required to pay a bit more toward your premiums. This added charge is an income-related monthly adjustment amount, or IRMAA.

IRMAA applies only to:

• Medicare coverage Part B (medical insurance),
• Part C (Medicare Advantage, a Medicare-approved plan offered by private companies that typically includes Parts A, B, and D and offers additional benefits and lower out-of-pocket costs), and
• Part D (prescription drug insurance).

IRMAA doesn’t apply to Medicare Part A hospital insurance coverage. That’s because most people paid Medicare taxes while they were working (it’s required for almost everyone who’s employed or self-employed). People who were exempted from paying Medicare taxes while working owe $565 per month in 2026 for Part A.

How is IRMAA calculated?

IRMAA isn’t based on your current income. Instead, use your federal tax return from two years earlier. So, your IRMA for 2026 is based on information from your 2024 tax return. Your tax filing status also comes into play. Here’s how IRMAA can impact Medicare costs in 2026, according to medicare.gov.¹

Does the IRMAA amount change every year?

Yes, the Centers for Medicare and Medicaid Services calculates your IRMAA every year. While you may be subject to the surcharge one year, you may not be the following year. Or you could move between brackets as your income rises or falls.

Typically, the IRMAA income limit increases each year. Remember that your IRMAA is based on your federal tax return from two years prior.

• In 2023, IRMAA applied to single filers whose MAGI in 2021 exceeded $97,000 or $194,000 for married couples filing jointly.
• In 2024, IRMAA applied to single filers whose MAGI in 2022 exceeded $103,000 and married couples filing jointly with a MAGI over $206,000.
• In 2025, IRMAA applied to single filers whose MAGI in 2023 exceeded $106,000 and married couples filing jointly with a MAGI over $212,000.

How does retirement income impact the cost of Medicare?

Some types of retirement income will count toward your MAGI, while other types won’t. To maximize your dollars, it’s important to be strategic about how you’re generating income. Your financial advisor or tax planner can help you better understand what your MAGI is and how it may impact your IRMAA.

Examples of retirement income sources that affect MAGI

• Social Security (only the taxable portion of your benefit will be factored into your MAGI)
• Traditional retirement accounts like 401(k)s and IRAs
• Pensions
• Passive income from rental properties or other investments

Examples of retirement income sources that don’t affect MAGI

• Roth IRAs
• Surrenders, loans, or cash value from a permanent life insurance policy (unless the distributions you get exceed your premiums)
• Distributions from a health savings account (HSA)

If your MAGI is high enough, you’ll pay more in monthly premiums for Medicare Part B and Part D coverage. Your IRMAA will also automatically be deducted from your monthly Social Security benefit payment.

This is another reason it’s so important to approach retirement planning strategically to give yourself options to create tax-efficient retirement income. By strategically drawing from certain sources, you’ll be able to manipulate what your taxable income (and your MAGI) is to stay within a desired range and minimize the impact of taxes. A financial advisor can help you see how all your assets can work together to maximize what you’ve saved.

What happens if IRMAA applies to me?

Remember that the Social Security Administration uses IRS data from two years prior to determine whether or not IRMAA will apply to you. If your income level triggers an income-related monthly adjustment amount, the Social Security Administration will send you a predetermination notice with the details.

If you think there’s been an error, you can dispute the decision. You can also request a reduction if you’ve experienced a qualifying life-changing event within the last two years that has impacted your financial situation significantly. Qualifying life-changing events can include the following:

1. Unemployment or underemployment (including retirement)
2. Loss of an income-producing property
3. Marriage
4. Divorce
5. Death of a spouse

If your IRMAA determination is correct, and you’re already receiving monthly Social Security payments, the amount you owe will be deducted from your benefit. If you don’t already get Social Security payments, you’ll receive a separate bill for the IRMAA amount.

How do I reduce IRMAA?

Ultimately, to reduce your IRMAA, you need to reduce your MAGI. Here are some strategies to reduce your taxable retirement income, which you could talk over with your financial advisor.

• Having a mix of taxable and nontaxable assets to pull from
• Strategically buying and selling investments to offset gains and losses (known as tax loss harvesting)
• Planning ahead with financial tools like Roth accounts, permanent life insurance, non-qualified annuities, and HSAs
• Delaying your Social Security benefits
• Donating to charities

Ultimately, carefully planning your retirement income can help you stay within your desired IRMAA threshold in retirement. But retirement planning isn’t a one-time action. While you’re still working, you’ll need to have a good idea of how you want retirement to look and how you’ll get there. As you near retirement, you’ll need to adjust your plan based on what you’ve saved. And in retirement, you’ll need to manage your assets to make sure you’re getting the most out of them. Thankfully, you don’t need to do this alone. Your Northwestern Mutual financial advisor can help.

An advisor will get to know you and your goals—including your goals in retirement. Together, you and your advisor will create a plan that can help you achieve all you want before and during retirement, accounting for risks (like taxes) that could eat away at what you’ve earned.

Frequently Asked Questions

What income is used to determine your IRMAA?

IRMAA is based on your income, specifically your MAGI, which for Medicare purposes is your adjusted gross income plus tax-exempt interest. Your federal tax return from two years earlier determines whether the surcharge applies.

Can IRMAA be reduced or removed if your income drops?

Yes. If your income has fallen because of a qualifying life-changing event, such as retirement, unemployment, divorce, or the death of a spouse, you may be able to request a reduction in your IRMAA.

Does a Roth conversion affect IRMAA?

A Roth conversion can increase your taxable income in the year you complete the conversion. Because IRMAA is based on your income from two years earlier, a large Roth conversion could increase your Medicare premiums two years later. For this reason, it’s often ideal to complete Roth conversions prior to age 63. Be mindful of how much taxable income makes sense to convert based on tax brackets and income.

Is IRMAA a permanent increase in my Medicare premiums?

No. The Centers for Medicare & Medicaid Services recalculates IRMAA each year. Depending on changes in your income, you may move into a different IRMAA bracket, stop paying the surcharge altogether, or have to pay it after previously avoiding it.

How can I avoid paying IRMAA in retirement?

The key is managing your income, specifically your MAGI. Strategies may include drawing income from a mix of taxable and nontaxable assets; using tax-loss harvesting; planning ahead with financial tools like Roth accounts, permanent life insurance, non-qualified annuities, and health savings accounts; delaying Social Security benefits; or making charitable donations. Your financial advisor, along with your tax advisor, can help you develop a tax-efficient withdrawal strategy that may reduce the likelihood of triggering IRMAA.

Will selling investments increase my IRMAA?

Selling investments at a gain may increase your taxable income, which can raise your MAGI. Because IRMAA is determined by your MAGI, higher investment income could move you into a higher IRMAA bracket and increase your Medicare premiums in a future year. Strategic planning, including techniques such as tax-loss harvesting, may help reduce the impact.

This publication is not intended as legal or tax advice. Financial representatives do not render tax advice. Consult with a tax professional for tax advice that is specific to your situation.

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