Medicare MAGI: What it means for IRMAA
A person’s modified adjusted gross income (MAGI) determines whether they pay higher Medicare Part B or Part D premiums. In 2025, this will be based on 2023’s MAGI. In 2026, it will depend on 2024’s MAGI and new premium rates.
Modified Adjusted Gross Income (MAGI) is a common tax term that refers to a person’s Adjusted Gross Income (AGI) plus certain additions, such as excluded income or specific deductions.
The IRS uses MAGI to determine eligibility for various tax credits, deductions, and retirement plans. Additionally, MAGI can affect the amount a person may pay for Medicare Part B or Part D premiums.
People enrolled in Original Medicare (Part A or B) or Medicare Advantage (Part C) plans must pay an additional amount above their standard Part B and Part D premiums. This is known as the income-related monthly adjustment amount (IRMAA).
The IRMAA depends on a person’s MAGI. The following chart shows how much a person can pay in premiums in 2025, depending on their MAGI from 2 years earlier. Higher incomes result in higher surcharges.
To calculate their MAGI, a person takes their AGI for the relevant year and makes certain additions, not including any untaxed portions of Social Security benefits.
Medicare assesses whether an individual must pay a surcharge in addition to the standard premium. Also, the surcharge for 2026 will depend on a person’s 2024 MAGI.
Once a person has their MAGI for 2024, they will be able to use it to calculate their Medicare premiums in 2026. However, they will have to wait until the Centers for Medicare & Medicaid Services (CMS) announces Part B premium pricing for 2026.
It is important to note that while Part B costs are standardized, Part B premiums vary depending on the specific plan.
While the national base Part D premium is expected to rise to $38.99 in 2026, actual premiums will differ depending on the plan provider. Thus, the surcharge will be added to the particular premium of a person’s specific plan.
If an individual believes their IRMAA surcharge is incorrect or has been misapplied, they can request a review of the charge by contacting the Social Security Administration (SSA) by phone or submitting a written request. If the SSA denies the request, the individual has 60 days to file an appeal.
The SSA will review any additional submitted documentation and issue a new decision. If SSA approves the appeal, it will adjust a person’s premiums. Otherwise, it will explain how to appeal again through a separate review.
A person’s MAGI is a tax measure that starts with their AGI and adds certain types of excluded income or deductions.
The IRS uses MAGI to determine how much money to add to a person’s Medicare Part B and Part D premiums.
In 2025, IRMAA is calculated using a person’s 2023 MAGI, while in 2026, it will be based on updated Medicare premiums and a person’s 2024 MAGI.