5. Triggering Medicare IRMAA Surcharges
High-income retirees face an additional reduction to their Social Security checks through the Income-Related Monthly Adjustment Amount, commonly known as IRMAA. If your income crosses specific thresholds, Medicare charges you a surcharge on both your Part B and Part D premiums. You can review detailed Medicare surcharge information directly at Medicare.gov.
IRMAA operates on a two-year lookback period. This means your 2027 Medicare premiums—and subsequently, your 2027 net Social Security check—will be determined by the income you reported on your 2025 tax return. The IRMAA system uses a cliff bracket structure. If your Modified Adjusted Gross Income (MAGI) exceeds a threshold by even one single dollar, you are pushed into the higher premium tier for the entire year.
To understand how these cliffs function, consider the verified brackets used for 2026 (which were based on 2024 income):
| Individual Filer MAGI | Joint Filer MAGI | Monthly Part B Premium (2026) |
|---|---|---|
| $109,000 or less | $218,000 or less | $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 or more | $750,000 or more | $689.80 |
If you sold real estate, executed large Roth conversions, or took substantial Required Minimum Distributions (RMDs) in 2025, that income spike could trigger IRMAA surcharges in 2027. This will automatically shrink your net Social Security deposit.
