At 67, His Commission Income Will Fall $80,000 in a Bad Year. Social Security Will Keep Pricing His Medicare Premium on the Good Year, Because a Slow Market Is Not One of the Eight Events on Form SSA-44
A commissioned salesman's best career year locked in two years of Medicare surcharges he cannot appeal away, and when the market turned slow, he discovered just how few options the government gives him.
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A 67-year-old commissioned salesman closed 2024 with the best year of his career. He and his wife, both on Medicare, reported joint modified adjusted gross income (MAGI) of $290,000. In 2026, a slow market cut his commissions by $80,000, pulling household MAGI toward $210,000. His Medicare premiums stayed exactly where they were, because Social Security is still billing him on 2024.
Why a $210,000 Year Still Pays Like a $290,000 Year
Social Security sets each year’s income-related monthly adjustment amount (IRMAA) from the tax return filed two years earlier: 2024 income sets 2026 premiums, 2025 sets 2027, and 2026 sets 2028. MAGI means adjusted gross income (AGI) plus tax-exempt interest, so municipal bond income counts. Only about 8% of beneficiaries pay any surcharge. A couple at or below $218,000 of joint MAGI (or a single filer at or below $109,000) pays the standard $202.90 Part B premium and owes nothing extra.
At $290,000, our couple lands in the second surcharge tier. Each spouse pays $405.80 a month for Part B plus a $37.50 Part D surcharge. That adds $240.40 per person per month, or $5,769.60 a year for the household. If their Medicare premiums come out of Social Security, the surcharge comes out of there too.
| 2024 Joint MAGI | Part B Premium (Monthly, Per Person) | Part D Surcharge (Monthly, Per Person) | Total Surcharge (Annual, Per Couple) |
|---|---|---|---|
| $218,000 or less | $202.90 | $0.00 | $0 |
| $218,001 to $274,000 | $284.10 | $14.50 | $2,296.80 |
| $274,001 to $342,000 | $405.80 | $37.50 | $5,769.60 |
A Slow Market Fails the SSA-44 Test
Form SSA-44 lets a beneficiary ask Social Security to use a more recent, lower year of income, but only after a qualifying life-changing event. SSA lists eight: death of a spouse, marriage, divorce or annulment, work reduction, work stoppage, loss of income-producing property, loss of employer pension income, and receipt of an employer payment. A weak sales year appears nowhere on that list.
Work reduction comes closest, and SSA defines it narrowly as a reduction in work hours, such as partial retirement or a change from full-time to part-time employment. Our salesman still works full weeks. His customers simply bought less. SSA’s manual also treats ordinary risk of loss taken at the time of investment as the beneficiary’s own doing, and lost dividend income qualifies only after criminal theft. A sagging brokerage account fails the same test. Applicants attest under penalty of perjury, so bending the facts to fit a category carries real legal risk.
Medicare enrollees on Reddit learn this the hard way. In an r/medicare thread titled “IRMAA APPEAL…..DENIED!!!!”, one reply summed up the rule: the form exists for “people who have a life changing event that lowers their income”.
What Would Open the Door
The picture changes if he retires or formally cuts his hours. SSA counts retirement, lay-off, and sale of a business as work stoppage and accepts a retirement letter, an employer statement, or his own attestation as proof. He would file SSA-44 with an estimate of current-year MAGI. Below the $218,000 line, the surcharge disappears. One catch: the finding applies only to the reporting spouse, so his wife must contact SSA separately.
SSA generally will not make a determination retroactive to a prior premium year. Without a qualifying event, his lean 2026 lowers premiums only in 2028. Meanwhile, the 2027 COLA is tracking around 3.5%, and if 2025 was another strong year, a 2027 surcharge can eat into that raise first (we mapped IRMAA and the other premium traps that catch retirees in a free Medicare guide here).
Plan the Good Year Before It Locks In
- Run the tier math before December 31 of a big year. At $290,000, the couple sat $16,000 above the $274,000 line. Pushing that much into pre-tax 401(k) deferrals or delaying a stock sale would have dropped them to the first tier and saved $3,472.80 in 2026 surcharges. A later bad year cannot undo that bill.
- Treat the lean year as a planning window. Because 2026 income sets 2028 premiums, he can use today’s $218,000 threshold as a rough guide to how much Roth conversion or capital gain he can recognize this year without triggering a surcharge.
- Document any real change in work. If he retires or moves to part-time, he should keep his retirement letter or pay stubs showing reduced hours and file SSA-44 in the same calendar year, with his wife filing her own request.
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Gerelyn Terzo is the author of dividend investing handbook "Dividend Investing Strategies: How to Have Your Cake & Eat It Too." A veteran financial journalist, she covers agri-finance for outlets like Global AgInvesting and the broader stock market and personal finance for 24/7 Wall Street. She began at CNBC and later helped launch Fox Business in New York. Gerelyn currently resides in Woodland Park, Colorado and dabbles in nature photography as a hobby.
