A 66-year-old retires in December 2025 after a final year of $230,000 in salary and a deferred-compensation payout. Her first Medicare bill lands in February 2026 showing a Part B premium of $527.50, not the standard $202.90. Her Part D plan adds its own surcharge. She owes Medicare thousands more this year than her neighbor on identical coverage, because Social Security pulled her 2024 tax return, the year she was still working.
This is IRMAA, the Income-Related Monthly Adjustment Amount. It hits roughly 8% of Medicare beneficiaries. If your household income sits comfortably below the first cliff ($109,000 single or $218,000 joint), you can stop reading. You owe the standard premium and nothing more. If you crossed into surcharge territory on a salary you no longer collect, the next 60 days decide what you pay this year.
The Two-Year Lookback Drives the Bill
Social Security calculates IRMAA from your modified adjusted gross income two years back. MAGI is line 11 of Form 1040 plus tax-exempt interest from line 2a, so municipal bond income counts even when it feels tax-free. Your 2026 Medicare premium runs off your 2024 return. For someone who worked through 2024, retired in 2025, and enrolled in Medicare in 2026, the lookback prices a working-year income into a retirement-year budget.
The 2026 brackets, from CMS:
| Single MAGI (2024) | Joint MAGI (2024) | Total Part B premium |
|---|---|---|
| ≤ $109,000 | ≤ $218,000 | $202.90 |
| $109,001 to $137,000 | $218,001 to $274,000 | $284.10 |
| $137,001 to $171,000 | $274,001 to $342,000 | $405.80 |
| $171,001 to $205,000 | $342,001 to $410,000 | $527.50 |
| $205,001 to $499,999 | $410,001 to $749,999 | $649.20 |
| ≥ $500,000 | ≥ $750,000 | $689.90 |
At the top tier, a single retiree pays $487 more a month on Part B and up to $91 more a month on Part D. The combined surcharge tops out at $6,936 a year above the baseline premium. For a married couple both on Medicare, double it: roughly $13,872 in surcharges for one bad MAGI year.
SSA-44: The Form That Fixes a Mismatch
If your income dropped because of a qualifying life-changing event, file Form SSA-44 to ask Social Security to use a current income estimate instead of your two-year-old return. The eight qualifying events: marriage, divorce or annulment, death of spouse, work stoppage, work reduction, loss of income-producing property from a disaster or similar event, loss of pension income, and an employer settlement payment.
Retirement is the workhorse. Work stoppage covers a clean exit from a job. If you stopped working in 2025 and your 2026 MAGI will land below the first tier, SSA-44 replaces the 2024 income on file with your current-year estimate. The surcharge drops prospectively, and your Medicare bill falls as soon as Social Security processes the form.
SSA-44 does not reverse a voluntary income event. A Roth conversion, a stock sale, or a profitable home sale fall outside the eight categories, and Social Security will deny appeals built on them. The form addresses income that fell, not income you elected to realize.
The 60-Day Clock and the Survivor Trap
You have 60 days from the date on your IRMAA determination notice to file. Miss the window and the surcharge stands for the year. File early with documentation: a retirement letter or final pay stub for work stoppage, a death certificate for survivor cases, a divorce decree where it applies.
One trap catches widows and widowers a year or two into Medicare. When a spouse dies, the survivor files as single, and the single brackets are roughly half the joint ones. Same household income, new bracket, new surcharge. SSA-44 handles this too. Death of spouse is a listed event.
What to Do
- Compare your 2024 MAGI to the brackets above. If you crossed $109,000 single or $218,000 joint and your 2026 income will be lower because you stopped working, SSA-44 is on the table.
- File SSA-44 within 60 days of your IRMAA determination notice. Attach proof of the life event and your best estimate of current-year MAGI, not last year’s.
- Plan the next lookback now. Your 2025 return drives 2027 premiums and your 2026 return drives 2028. If a severance check, deferred comp, or a one-time RMD will push your first retirement-year MAGI over a bracket, model the surcharge before December and decide whether to push a voluntary income event into a lower-tier year.
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