A retiree who sells a rental property in 2026, completes a large Roth conversion, or has an unusually big required minimum distribution year may not feel the consequence until 2028. That is when the Social Security Administration looks back at the 2026 tax return and applies the Income-Related Monthly Adjustment Amount — IRMAA — to Medicare Part B and Part D premiums. The surcharge can run from roughly $1,100 to nearly $7,000 per person per year on top of the standard premium, and it is recalculated annually based on income reported two years prior.
How the Brackets Work in 2026
For 2026, IRMAA surcharges begin once Modified Adjusted Gross Income exceeds $109,000 for single filers or $218,000 for joint filers. The brackets climb in tiers up to roughly $205,000 single and $410,000 joint, with the highest surcharges reserved for incomes above those thresholds.
Crucially, IRMAA is a cliff, not a phase-in. Earning one dollar over a threshold pushes the entire premium into the next tier. A couple with MAGI of $218,001 pays a meaningfully higher Medicare premium than a couple at $217,999, all year long.
The Two-Year Delay Catches People Off Guard
The 2026 surcharge is generally based on income reported on the 2024 tax return. That delay creates two distinct planning problems. First, retirees who had a one-time income event in 2024 — selling a business, large capital gain, full-year final salary before retiring — may be paying a surcharge in 2026 that no longer reflects their current finances. Second, income decisions being made today in 2026 are setting the Medicare premium that will arrive in 2028.
For households running multi-year Roth conversion ladders, this means each conversion needs to be modeled against future IRMAA thresholds, not just current-year income taxes. A conversion that looks tax-efficient on a federal return can quietly add thousands of dollars to Medicare premiums two years later.
What Retirees Can Do
Stack conversions strategically. Many planners recommend front-loading Roth conversions in the years between retirement and Medicare enrollment, typically ages 63 and earlier, then tapering once IRMAA exposure begins. Conversions completed at 63 affect premiums at 65.
Use Qualified Charitable Distributions. A QCD lets retirees send up to $111,000 in 2026 directly from a traditional IRA to a qualified charity, satisfying part or all of the RMD without raising MAGI. Because the distribution never lands on the tax return, it does not push income toward an IRMAA cliff.
Watch portfolio income. Interest, dividends, and realized capital gains all count toward MAGI. Holding income-producing assets in tax-deferred accounts, harvesting losses against gains, and using municipal bonds for taxable buckets can keep MAGI from drifting upward unintentionally. Allocations to assets that do not generate annual taxable income — including physical precious metals held in an IRA, where distributions are controlled by the owner — give retirees more flexibility to choose when income lands.
File an SSA-44 after a life-changing event. If retirement, the death of a spouse, divorce, or another qualifying event causes income to drop sharply, the Social Security Administration allows an appeal using Form SSA-44. Approved appeals let SSA use more recent income data rather than the two-year-old return, which can erase the surcharge for the year.
The Bigger Picture
IRMAA is one of several stealth surcharges that turn retirement income planning into a coordination problem rather than a one-line tax calculation. Layered with the 3.8% Net Investment Income Tax, ordinary income brackets, and state taxes, a single uncoordinated withdrawal can ripple across three or four separate bills.
The two-year lookback also reframes diversification. Portfolios concentrated in pre-tax accounts force large RMDs that drive MAGI; portfolios spread across pre-tax, Roth, taxable brokerage, and hard assets like gold give retirees levers to pull when an IRMAA cliff looms. Knowing where the next bracket sits is half the battle. The other half is having a flexible mix of accounts to draw from when the cliff gets close.
Sources: Centers for Medicare & Medicaid Services, Social Security Administration, Kiplinger, Internal Revenue Service, The Silver Institute, World Gold Council