IRMAA - Income Related Monthly Adjustment Amounts
What is IRMAA?
IRMAA stands for Income Related Monthly Adjustment Amounts. High-income households pay an extra charge—IRMAA—on top of the standard Medicare premium. IRMAA can apply to either Medicare Part B or Medicare Part D premiums. If you fall into one of the high-income categories—more than $106,000 for individuals and $212,000 for couples—the Social Security Administration (SSA) will notify you. The IRMAA notification from SSA might happen when you first apply for Medicare, but it can be triggered at any other time post initial Medicare enrollment if your income exceeds the threshold.
There is a two-year lookback for IRMAA. For example, if your income as reported on your tax return from 2023 fell into the high-income category, you would pay IRMAA for 2025 Medicare monthly premiums.
2025 Medicare Part B Premium & IRMAA
2025 Medicare Part D IRMAA
How to Reduce or Eliminate IRMAA if Your Income Is Lower Today Compared to Two Years Ago
Since IRMAA is calculated on your income from two years ago, many federal retirees might have less income today than when IRMAA was initially calculated. If you experience a life-changing event that reduces your income, you can request an IRMAA reduction from the SSA. Learn more here or by calling 800-772-1213.
The following life-changing events are allowed for IRMAA reductions:
- Marriage
- Divorce/Annulment
- Death of Your Spouse
- Work Reduction
- Loss of Income-Producing Property
- Loss of Pension Income
- Employer Settlement Payment
- Work Stoppage/Retirement
Most federal employees will have lower income once they retire compared to when they were active employees. Work stoppage is an allowed life-changing event, and every new federal retiree that qualifies for IRMAA should request a reduction from the SSA if they will have lower income in retirement.
Example: A two-person household filing a joint tax return had adjusted gross income (AGI) of $280,000 in 2023 and 2024. They both plan on retiring on July 1, 2025 and will therefore spend half of 2025 as active employees and half as retired employees. They expect to have $210,000 in income in 2024 and only $180,000 in income in 2025 when they spend the entire year retired. SSA would assign IRMAA based on their 2023 AGI of $280,000, and they would have to pay $369.10 each for Medicare Part B when they retire if they do not ask for an IRMAA reduction. Instead, they should request an IRMAA reduction for 2025 as their expected AGI would place them in a lower IRMAA category, which reduces the Part B premium to $258.60 for 2025. They should also inform SSA that their anticipated 2025 AGI of $180,000 would put them below the high-income threshold and therefore only have it pay the regular Part B premium of $185 in 2025. The SSA requires tax returns and qualified life-changing event documentation for IRMAA reductions. In the case where income is a projection, SSA will confirm the projected income total when that tax return year is officially filed with the IRS. If during the IRMAA reduction process you overpay your Part B or Part D premiums, the SSA will issue a refund.