Their CPA Will File Them Separately in 2026 So Her Medical Bills Clear the Deduction Floor. His $140,000 Return Will Cost Him $6,355 More in Medicare Surcharges in 2028, Where a Joint Return Would Have Cost $0
A retired couple's CPA spotted a clever way to wipe out her medical bills on their taxes, but the move quietly sets a Medicare tripwire two years out that neither of them saw coming.
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Take a hypothetical retired couple who are both on Medicare. He reports $140,000 of modified adjusted gross income (MAGI) from a pension and IRA withdrawals. She reports $60,000 and paid substantial uncovered medical bills from her own funds this year. Their CPA suggests filing their 2026 returns separately so her bills clear the deduction floor against her smaller income. He doesn’t worry about Medicare, because their combined $200,000 sits below the $218,000 joint threshold for the income-related monthly adjustment amount (IRMAA).
That reasoning stops working once he signs a separate return. About 8% of Part B enrollees pay any income surcharge, and couples filing jointly well under $218,000 are among those who pay none. Filing separately can move a modest earner into that 8%.
Medicare Reads the Filing Box
Social Security sets IRMAA using adjusted gross income plus tax-exempt interest, so municipal bond income counts. It looks back two years: the 2026 return sets 2028 premiums. The Centers for Medicare & Medicaid Services (CMS) publishes a separate three-tier bracket table for married couples who file separately and lived together at any point during the tax year.
| Separate-return MAGI (lived with spouse) | Part B surcharge, monthly per person | Part D surcharge, monthly per person |
|---|---|---|
| Up to $109,000 | $0 | $0 |
| Over $109,000 to under $391,000 | $446.30 | $83.30 |
| $391,000 or more | $487.00 | $91.00 |
At or below $109,000, he would pay the standard $202.90 Part B premium. One dollar more and his premium becomes $649.20. That is the same premium a single filer pays only with income above $205,000. On a joint return, the couple’s $200,000 puts both of them on the standard $202.90 premium.
How Much Could the Separate Return Cost?
At 2026 rates, his Part B surcharge comes to $5,355.60 annually. Part D adds $999.60, bringing the total to $6,355.20. She owes no surcharge at $60,000 in MAGI. That’s the couple’s additional annual Medicare cost under current rates, although actual 2028 amounts aren’t available yet.
Form SSA-44 can’t fix this later. It reduces IRMAA only after a qualifying life-changing event, such as the death of a spouse, divorce or stopping work. Choosing a filing status doesn’t qualify.
Weighing the Deduction Against the Premiums
Federal law allows an itemized deduction for medical expenses exceeding 7.5% of adjusted gross income. Their joint threshold is $15,000, compared with $4,500 on her separate return. But the deduction doesn’t reduce the income Medicare uses to calculate IRMAA.
Filing separately could increase her medical deduction by as much as $10,500, assuming she paid enough qualifying expenses. At an illustrative 22% tax rate, that’s $2,310 in savings, against $6,355.20 in additional Medicare premiums. The difference is $4,045.20 before other tax consequences.
Separate returns have other costs too. If she itemizes, his standard deduction drops to zero. The new deduction of up to $6,000 per eligible senior also requires a married couple to file a joint return.
At their income, the medical deduction alone is unlikely to offset his Medicare surcharge. Filing separately may still make sense for other tax reasons, but the CPA needs to compare the couple’s full tax and premium costs. Several premium traps catch retirees who optimize for one thing and forget the other, and we explained the rest in a free Medicare guide.
Questions for the CPA Before Filing
- “Show me both returns with the 2028 Medicare premiums included.” Ask for the full tax difference between filing jointly and separately, including the lost standard and senior deductions. Then subtract $6,355.20. If the separate return doesn’t beat that number, file jointly.
- “Can my separate MAGI get to $109,000 or less?” Ask whether future IRA withdrawals can be shifted to another year or whether tax-exempt interest is pushing his income above the threshold. Landing just under the line means he pays no surcharge. Missing it by any amount costs the full $6,355.20.
- “If we already filed separately, can we switch?” A married couple can change separate returns to a joint return for up to 3 years after the original filing deadline. Social Security can recalculate IRMAA using the amended return, along with IRS confirmation or a transcript. Request the adjustment within the agency’s three-calendar-year deadline.
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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.
