IRMAA: Why Your Income Matters for Medicare Premiums Two Years From Now
Medicare premiums for high earners are based on income from two years ago — which means a decision you make this year won't show up on your premium bill until 2028.
Most tax decisions show up on your return the following spring. IRMAA doesn't work that way — the income you report this year determines what you'll pay for Medicare Part B and Part D premiums two years from now, in 2028.
That delay is exactly what makes IRMAA easy to miss and expensive to get wrong. A decision that looks purely like a 2026 tax question — a Roth conversion, a large capital gain, a big charitable deduction — is also, quietly, a 2028 Medicare premium question.
How the Two-Year Lookback Actually Works
For 2026, Medicare uses your 2024 tax return to determine whether you owe an income-related monthly adjustment amount, or IRMAA, on top of the standard Part B and Part D premiums. The standard Part B premium in 2026 is $202.90 a month; the surcharge begins once modified adjusted gross income crosses $109,000 for a single filer or $218,000 for a married couple, both based on income from two years prior.
It's a Cliff, Not a Slope
Unlike ordinary tax brackets, IRMAA applies to your entire premium once you cross a threshold — not just the income above it. Cross the first threshold by a single dollar and you pay the full surcharge for that tier, which can add roughly $1,000 or more per year, per person. For a married couple both on Medicare, that's a household hit, not an individual one.
Why This Matters for a Roth Conversion Decision
A Roth conversion executed in 2026 doesn't affect your 2026 Medicare premium at all — those are already set based on 2024 income. It affects your 2028 premium. If you're modeling a multi-year conversion strategy, each year's conversion needs to be checked against the IRMAA thresholds two years out, not just against your current tax bracket. This is one of the more common places we see a well-intentioned conversion plan create an unplanned Medicare cost.
If Your Income Has Genuinely Changed
IRMAA determinations can be appealed using Form SSA-44 if you've had a qualifying life-changing event — retirement, divorce, loss of a pension, or the death of a spouse, among others. If you retired in 2025 but your 2024 return (the year used for your 2026 premium) still reflects a full year of salary, this is worth filing rather than assuming the higher premium is unavoidable.
The Windward Approach
Because IRMAA operates on a two-year delay, it's easy to treat as someone else's problem until the bill arrives. We check IRMAA exposure as part of any Roth conversion or large-income-event conversation with clients approaching or already on Medicare, specifically because the consequence shows up on a different year's premium than the one where the decision was made.
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