On the September 15, 2022 episode of Ask Suze & KT Anything, Suze Orman pulled back the curtain on something most retirees never see coming until it hits their own bank account. She was talking about her wife KT’s Social Security deposit, and the number she described should make every high earner approaching 65 pay close attention.
Here is what Suze said: “That’s why I was just showing KT the other day that she got a Social Security check, right, put into her account and they had to subtract 560, I think almost $600 for her Medicare B part of it. So the more money you make, the more you have to pay.”
That number is real. It reflects IRMAA, the Income Related Monthly Adjustment Amount, and if your income crosses certain thresholds in retirement, it can quietly carve hundreds of dollars off every Social Security check you receive. Roughly 5.1 million Medicare beneficiaries paid Part B IRMAA surcharges in 2025, about 7% to 8% of all enrollees, yet the surcharge still catches most retirees by surprise.
What IRMAA Actually Does to Your Check
IRMAA is a premium add-on the government withholds directly from your Social Security deposit before the money ever lands in your account. It is not a tax you file at year-end. Most people pay the standard Part B monthly premium amount, which is $202.90 in 2026. High earners pay considerably more. For 2026, higher earners pay anywhere from $284.10 to $689.90 per month depending on their 2024 income. The gap between the standard rate and what a high earner pays is the IRMAA surcharge, and it scales upward across five tiers as income rises.
When Suze mentioned in 2022 that she and KT were paying roughly $526 a month out of their Social Security checks for Medicare Part B, that figure reflected their own income-related surcharge at the time. In 2026, IRMAA adds $81.20 to $487.00 per month to Part B, and up to $91.00 more for Medicare Part D drug coverage, across five surcharge tiers. Part D surcharges are a separate layer that the original announcement of IRMAA rarely covers, but they compound the total cost for retirees who carry prescription drug coverage.
The mechanic that makes IRMAA so dangerous is the lookback. The SSA determines who pays an IRMAA based on income reported two years prior. In other words, the SSA looks at your 2024 tax returns to determine what you owe in 2026. A one-time event in 2024, whether that is selling a rental property, exercising stock options, or completing a large Roth conversion, can spike your premium two years later, long after the cash has been spent or reinvested.
The Math on a Realistic Scenario
Consider a married couple who sells a rental property in 2024 and recognizes $200,000 in capital gains on top of their normal $120,000 retirement income. Their modified adjusted gross income jumps to $320,000 for that single year. For 2026, IRMAA income brackets and surcharges increased by approximately 3% and 9%, respectively. At $320,000 joint MAGI, both spouses land in a higher IRMAA tier, and each faces a significantly elevated Part B premium.
If each spouse’s total monthly Part B premium rises by roughly $400 due to the surcharge, that is $800 a month for the couple combined, or about $9,600 over the full year. They earned the gain in 2024, paid capital gains taxes on it by April 2025, and then in 2026 watched another five-figure bill come out of their Social Security checks for a property they no longer own. That is the IRMAA cliff effect. IRMAA does not work like a traditional tax bracket. Once your MAGI exceeds a threshold, the full surcharge for that bracket applies to your entire premium, not just the amount over the threshold.
The same trap snaps shut on retirees who do aggressive Roth conversions in their 60s, take a large required minimum distribution, or sell a business. The income event is finite. The IRMAA bill arrives two years later as though the income were permanent.
The Variable That Decides Whether IRMAA Is Permanent
Whether your high-income year was a one-time event or your steady state is the factor that changes everything. A retiree consistently drawing $400,000 a year from a portfolio should treat IRMAA as a permanent line item in their Medicare budget and plan around it from day one. But if the high-income year came from a property sale, an inheritance event, or a Roth conversion, there is a path back to lower premiums.
Suze pointed to the fix on the same podcast episode: Form SSA-44. Form SSA-44 is the Medicare IRMAA appeal form. It lets Medicare beneficiaries challenge their IRMAA premium when a qualifying life-changing event has reduced their income since the tax year SSA used. Form SSA-44 recognizes eight specific categories of life-changing events. Common qualifying events include retirement, loss of employment or income, marriage, divorce, or the death of a spouse. The sale of a property by itself does not automatically qualify, but retirement triggered by that sale often does, and “loss of income-producing property” is its own recognized category.
What to Do Before Your Next High-Income Year
Run the numbers before pulling the trigger on any large income event in your 60s or later:
- Pull the current IRMAA bracket chart from Medicare.gov and find where your projected modified adjusted gross income lands two years out. IRMAA works as a cliff system, meaning exceeding an income threshold by even $1 can trigger the full surcharge for the next tier. The difference between the top of one bracket and the bottom of the next can be a few thousand dollars of income that triggers thousands in surcharges.
- If you have a one-time income event coming, consider whether you can split it across two tax years to keep each year under the next IRMAA threshold. Remember that Part D carries its own IRMAA layer on top of Part B, so the true cost of crossing a bracket is higher than the Part B surcharge alone.
- If a life-changing event has already happened, download Form SSA-44 from the Social Security website and file it promptly. You can submit the form by mail or through the SSA’s online portal. Do not wait for Medicare to recalculate on its own.
Suze’s comment about KT’s check is the clearest warning a high-earning retiree will get: the bigger your income in the rearview mirror, the smaller your Social Security deposit right now. The two-year lag between the income event and the premium bill is what makes it feel like it came out of nowhere. It came from a tax return you filed two years ago.
Editor’s note: This article was updated to reflect the current 2026 standard Medicare Part B premium of $202.90 per month (up from $185 in 2025), the 2026 IRMAA Part B surcharge range of $81.20 to $487 per month, the five-tier surcharge structure with entry thresholds of $109,000 (single) and $218,000 (joint), the additional Part D IRMAA surcharge layer of $14.50 to $91 per month, and the figure that approximately 5.1 million beneficiaries paid Part B IRMAA surcharges in 2025.
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