A woman came to us a few months after we'd onboarded her, holding a letter she didn't understand. Her previous advisor had been making moves on her behalf, a distribution here, an investment sale there, without ever once checking what those moves were doing to her income on paper. Nobody was watching the whole picture. And now the letter in her hand was telling her that her Medicare premium was about to jump by hundreds of dollars a month, because of income decisions made two years earlier by someone who never tracked where that number would land.

She kept asking the same question. Why didn't anyone tell me this was coming?

Honestly? I've asked that same question about a lot of advisors who aren't looking at the whole picture. It's a big part of why this post exists.

Here's the short version. IRMAA surcharges in 2026 are based on your 2024 tax return, not your current income. Single filers with 2024 income over $109,000 are paying anywhere from $81.20 to $487.00 more a month for Part B, plus a Part D surcharge on top. The decisions that avoid this happen two years before the bill ever shows up.

What IRMAA Actually Is

IRMAA stands for Income-Related Monthly Adjustment Amount. It's the surcharge Medicare adds to your Part B and Part D premiums once your income crosses certain thresholds, and it catches a lot of retirees off guard because it doesn't show up as a line on a tax return. It shows up as a bigger number on a Medicare bill, months or years after the income decision that caused it.

That's real money. A single filer who crosses just the first threshold is paying almost $1,150 more a year for Part B alone, before Part D is even added in.

The Two-Year Rule

Here's the thing. Most articles about IRMAA leave out the part that actually matters if you want to do something about it. The income that sets your premium comes off your tax return from two years ago, not the one you just filed.

That two-year gap is the whole story. It's why a retiree can make a perfectly reasonable decision this year, a large Roth conversion, a big capital gain from selling a rental property, an unusually large required distribution, and not feel any consequence at all until a letter shows up describing a premium increase that already happened somewhere in the paperwork, two years in the past by the time it lands.

Most people meet IRMAA the same way that woman did, as a letter that already happened, past tense, with nothing left to do but pay it.

How This Plays Out

Say a couple is filing jointly with income normally sitting around $200,000. They're in a strong Roth conversion window and considering converting $30,000 this year to take advantage of a lower bracket while it lasts. That conversion alone could push their MAGI for the year past $218,000, the joint-filer threshold where the first IRMAA tier begins.

If nobody checks the math before the conversion happens, the couple doesn't feel anything this year. Two years from now, their Medicare Part B premium jumps by $81.20 a month per person, plus a Part D surcharge on top, and it stays there for that full year based on income they earned two years earlier. Run that same conversion with the IRMAA threshold checked first, and the couple might convert $25,000 instead of $30,000, stay under the line, and capture almost all the same tax benefit without triggering two years of higher Medicare premiums for both of them.

This example is illustrative, not a promise. Every household's actual numbers, deductions, and other income sources change where the real threshold sits, and the dollar figure will always be different for you. What stays the same is that somebody has to actually run that math before the decision gets made.

How We Do This Differently

That woman's previous advisor wasn't a bad person. He just didn't have the full picture, and in most advisory relationships, nobody is set up to have it. The investment recommendations come from one place. The tax return gets filed somewhere else, months later, by someone who never saw the distribution get made. By the time anyone connects the two, the decision is long finished and the only thing left to do is absorb the consequence.

We built Sound Wealth to close that gap. We manage the investments, we do the planning, and we handle the tax projection and preparation ourselves, under one roof. That means the person modeling a Roth conversion this year already knows what your MAGI needs to look like to stay clear of a Medicare surcharge two years from now, because it's the same person who will be preparing your return either way.

For the woman who came to us with that letter, there wasn't a way to undo it. The decisions that caused it were already two years old by the time we saw the numbers. What we could do was make sure it never happened again, because every recommendation from that point forward gets checked against the full picture before it's made, not after.

Frequently Asked Questions

What is IRMAA and who has to pay it?

IRMAA is the Income-Related Monthly Adjustment Amount, a surcharge Medicare adds to Part B and Part D premiums for people whose income crosses set thresholds. It applies to anyone enrolled in Medicare Part B or Part D whose modified adjusted gross income from two years earlier is above the base level, which for 2026 is $109,000 for single filers and $218,000 for married couples filing jointly.

How is my Medicare premium calculated for 2026?

Your 2026 premium is based on your 2024 tax return, specifically your modified adjusted gross income from that year. The Social Security Administration pulls this figure directly from the IRS and assigns you to one of six tiers, from no surcharge up to the highest bracket at $500,000 and above for single filers.

Can I appeal an IRMAA surcharge?

Yes, in specific circumstances. The Social Security Administration allows an appeal, called a life-changing event request, if your income has dropped since the tax year used to calculate your premium due to retirement, divorce, the death of a spouse, or a few other qualifying events. It does not apply simply because your income has changed for ordinary reasons like investment gains or a Roth conversion.

Does a Roth conversion trigger IRMAA?

A Roth conversion itself doesn't automatically trigger IRMAA, but the income it adds to your tax return can push your MAGI over a threshold if the conversion is large enough relative to your other income. Because the surcharge is based on income from two years earlier, the effect of a conversion made this year won't show up in your Medicare premium until two years from now.

When do IRMAA brackets reset each year?

The dollar thresholds are adjusted annually, and the Centers for Medicare & Medicaid Services publishes the new brackets and premium amounts each fall for the coming year. Your placement within those brackets is reassessed every year based on your tax return from two years prior, so a household can move between tiers from one year to the next as income changes.

If any of this resonates with you, whether there's a Roth conversion on the calendar or a decision already made without anyone checking the math, I'd genuinely love to have that conversation. And if you know someone, a parent, a friend, a business owner heading toward Medicare, who's never had anyone check this math for them, this is the kind of post worth forwarding.