A 66-year-old who walked out of her corporate job last December opened her first Medicare bill in January and found a number she did not recognize. The standard Part B premium for 2026 is $202.90. Hers was $405.80, plus a Part D surcharge on top. The reason is buried in a rule almost no new retiree sees coming: Medicare looked at her 2024 tax return, the year she was still drawing a six-figure salary, and priced her 2026 coverage off that.
If your 2024 modified adjusted gross income was under $109,000 single or $218,000 joint, this article does not apply to you. Only about 8% of Part B enrollees pay the Income-Related Monthly Adjustment Amount, known as IRMAA. The rest pay the standard premium and can stop reading. For the new retiree who cleared one of those thresholds in her final working year, the rest of this matters a great deal, because there is a form that can erase the surcharge in the same year it hits.
The two-year lookback, explained in dollars
IRMAA prices today’s premium off a tax return from two years ago. Your 2024 MAGI sets your 2026 surcharge. Your 2025 return will set 2027. Your first full retirement year, 2026, will not flow through until 2028. That gap is the trap. You are paying working-income premiums on a retirement-income budget for up to two years.
MAGI for IRMAA is adjusted gross income (Form 1040, line 11) plus tax-exempt interest (line 2a). Municipal bond income that felt tax-free still counts. A single filer with 2024 MAGI of $150,000, comfortably above the first tier and into the second, owes the following in 2026:
- Part B total premium of $405.80 per month instead of $202.90, an IRMAA add-on of $202.90.
- Part D surcharge of $37.50 per month on top of whatever the chosen drug plan charges.
- Combined extra cost: $240.40 per month, $2,884.80 over the year.
A married couple at $300,000 of joint 2024 MAGI lands in the same tier two and pays that surcharge on each spouse: roughly $5,770 of unnecessary Medicare cost in 2026 alone.
Why SSA-44 actually works here
Most readers have heard that IRMAA appeals rarely succeed. That reputation comes from people trying to appeal voluntary income events: a Roth conversion, a big capital gain, a home sale. None of those qualify, no matter how much they spiked MAGI. The Social Security Administration’s Form SSA-44 only accepts eight specific life-changing events: marriage, divorce or annulment, death of a spouse, work stoppage, work reduction, loss of income-producing property, loss of pension income, and employer settlement payment.
Work stoppage and work reduction are on that list, making retirement one of the most common qualifying events used for an SSA-44 request. If you stopped working in 2025 or 2026 and your income dropped substantially, SSA may recalculate the surcharge using an estimate of your current year’s MAGI rather than relying solely on the 2024 tax return on file.
The other half of the math is straightforward. If the same retiree’s current-year MAGI falls to roughly $60,000 after leaving work, he or she would typically fall below the first IRMAA threshold. If SSA approves the SSA-44 request, the beneficiary’s premium can be recalculated using the lower income estimate, potentially eliminating the surcharge and reducing premiums to the standard rate. For someone who would otherwise spend the entire year in that IRMAA tier, the savings can be substantial.
What to do this week
- Download Form SSA-44 from ssa.gov. Check the box for “Work Stoppage” or “Work Reduction,” enter the month and year your employment ended, and provide a current-year MAGI estimate built from expected Social Security, pension, dividend, interest, and any part-time income.
- Attach a retirement letter from your former employer, a final pay stub, or a signed statement confirming the stop date. SSA will not process the form without documentation of the event.
- Submit the form by mail or through the process SSA currently provides. If the request is approved, SSA can adjust future premiums and may credit prior overpayments, depending on the timing of the determination and the beneficiary’s circumstances.
Skip the form and the surcharge corrects itself anyway when your 2026 return reaches SSA in 2028. Filing SSA-44 simply pulls that fix forward by two years. For a single filer in tier two, that is close to $5,800 kept in the household rather than mailed to CMS while waiting for the lookback to catch up.
Sources: CMS, “2026 Medicare Parts A & B Premiums and Deductibles,” released November 14, 2025; Social Security Administration Form SSA-44 and ssa.gov/medicare/lower-irmaa. Figures reflect the 2026 plan year.
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