9 Things About IRMAA

[somarco]

Here's what you need to know about who gets charged and why, as well as when the fees can be waived.

One funding source for Medicare is a surcharge known as the income-related monthly adjustment amount (IRMAA) that is paid by beneficiaries when their income exceeds a certain threshold. It is assessed based on your tax return from two years prior. For 2025, your liability for the IRMAA was based on your 2023 tax return. This surcharge applies to individuals with traditional Medicare or Medicare Advantage plans.

Means testing is a hot topic when it comes to government benefits. But it's not just an academic debate, as high-income Medicare beneficiaries already pay higher premiums. In reality, requiring wealthier people to pay more can get a bit messy when income spikes for, say, just one year. Here's a look at some of the most frequent questions that come up regarding the IRMAA, including when it can be waived.

9 Things You Must Know About Medicare's Income-Related Monthly Adjustment Amount (IRMAA) Surcharges

Here's what you need to know about who gets charged and why, as well as when the fees can be waived.

www.kiplinger.com

 

[LostDollar]

With the steadily increasing prices of real estate I think the sale of a primary residence needs to be added to the schedule of life changing events.

The tax code is not friendly here to the newly single surviving member of a couple.

 

[annon123]

Here's what you need to know about who gets charged and why, as well as when the fees can be waived.

One funding source for Medicare is a surcharge known as the income-related monthly adjustment amount (IRMAA) that is paid by beneficiaries when their income exceeds a certain threshold. It is assessed based on your tax return from two years prior. For 2025, your liability for the IRMAA was based on your 2023 tax return. This surcharge applies to individuals with traditional Medicare or Medicare Advantage plans.

Means testing is a hot topic when it comes to government benefits. But it's not just an academic debate, as high-income Medicare beneficiaries already pay higher premiums. In reality, requiring wealthier people to pay more can get a bit messy when income spikes for, say, just one year. Here's a look at some of the most frequent questions that come up regarding the IRMAA, including when it can be waived.

9 Things You Must Know About Medicare's Income-Related Monthly Adjustment Amount (IRMAA) Surcharges

Here's what you need to know about who gets charged and why, as well as when the fees can be waived.

www.kiplinger.com

Another thing that triggers it, which will affect a lot of boomers, is when your student loan balance is written off once you have met your contractual number of years in repayment or through disability. This starts up again for all loans 1/1/2026 (pandemic pause put that on hold). When this happens you get a 1099-C for the amount written off (except disability through the VA and if it stays in the current budget bill then all disabled won't get one). That is considered ordinary taxable income. That is going to kick a number of people's income up as around 3 million people aged 65+ still have outstanding student loans. Most seniors are unaware that this will happen.

 

[somarco]

3 million people aged 65+ still have outstanding student loans

Many are folks who co-signed for children & grandchildren

Google AI
Cosigning student loans for children or grandchildren is a significant financial commitment, especially for seniors, who may be on fixed incomes or nearing retirement.

Key Considerations for Seniors Cosigning Student Loans:
Equal Responsibility: Cosigners are equally liable for the debt if the primary borrower defaults on the loan.

Potential Impact on Finances: Defaulting on a student loan can have severe consequences for a cosigner's credit score and potentially jeopardize their financial stability.

Social Security Garnishment: For government-backed loans, a cosigner's Social Security payments can be garnished if they fail to make payments.

Cosigner Release: Some private loans offer cosigner release options after a certain period of on-time payments, but this is not guaranteed and requires fulfilling specific requirements.



Yes, seniors who co-signed student loans may trigger IRMAA.
Here's why:

IRMAA is based on income: IRMAA (Income-Related Monthly Adjustment Amount) is an additional amount added to your Medicare Part B and Part D premiums if your income exceeds certain thresholds.

Unpaid interest increases reportable income: If the student loan is unpaid and accruing interest, that accrued interest can be considered income for the co-signer, potentially increasing their modified adjusted gross income (MAGI).

Higher income can trigger IRMAA: If the increased MAGI due to the accrued student loan interest pushes a senior's income over the IRMAA thresholds, they would then be subject to the higher Medicare premiums.

Important notes:
It's the income that matters: The direct act of co-signing doesn't automatically trigger IRMAA. It's the resulting increase in reportable income due to factors like accrued interest that could cause the issue.

IRMAA is based on prior year income: IRMAA is determined based on the income reported on your tax return two years prior. This means if your income was high two years ago, you may be subject to IRMAA even if your current income is lower.

Managing student loan debt is important: Seniors should carefully manage student debt, including co-signed loans, as retirement approaches to avoid unexpected increases in healthcare costs through IRMAA.

To mitigate this potential issue:

Explore repayment options: Consider options like income-driven repayment plans or refinancing to manage the debt.

Understand implications of co-signing: Be aware of the potential consequences of co-signing, including the impact on your own income and eligibility for programs like Medicare.

Ensure debt-free retirement: Aim for a debt-free retirement to minimize the risk of student loans impacting your financial stability.

Consider filing Form SSA-44 if income decreases: If a life-changing event (like retirement) significantly reduces your income, you may be able to appeal your IRMAA assessment by filing Form SSA-44.

 

[scagnt83]

Many are folks who co-signed for children & grandchildren

Not necessarily true:

"That data revealed about 80 percent of federal borrowers 65 and older had outstanding loans from their own education. Recent data from the Department of Education confirms that most older borrowers continue to have debt from their own education. While the number of borrowers aged 62 and older grew by 800,000 from 2017 to 2022, the number of Parent PLUS borrowers grew by only 100,000."

 

[annon123]

Here's what you need to know about who gets charged and why, as well as when the fees can be waived.

One funding source for Medicare is a surcharge known as the income-related monthly adjustment amount (IRMAA) that is paid by beneficiaries when their income exceeds a certain threshold. It is assessed based on your tax return from two years prior. For 2025, your liability for the IRMAA was based on your 2023 tax return. This surcharge applies to individuals with traditional Medicare or Medicare Advantage plans.

Means testing is a hot topic when it comes to government benefits. But it's not just an academic debate, as high-income Medicare beneficiaries already pay higher premiums. In reality, requiring wealthier people to pay more can get a bit messy when income spikes for, say, just one year. Here's a look at some of the most frequent questions that come up regarding the IRMAA, including when it can be waived.

9 Things You Must Know About Medicare's Income-Related Monthly Adjustment Amount (IRMAA) Surcharges

Here's what you need to know about who gets charged and why, as well as when the fees can be waived.

www.kiplinger.com

And if one defaults, even if it was years ago, social security can take 15% of your income (without a court case or anything else; this action had been on pause during the pandemic, then they have moved the date to start taking money from SS several times. If I recall correctly it now starts back up this Sept - it was May), although they have to leave you $750/mo to live on.

 

[Ron Van D]

Not necessarily true:

"That data revealed about 80 percent of federal borrowers 65 and older had outstanding loans from their own education. Recent data from the Department of Education confirms that most older borrowers continue to have debt from their own education. While the number of borrowers aged 62 and older grew by 800,000 from 2017 to 2022, the number of Parent PLUS borrowers grew by only 100,000."

Somarco did say MANY, not most. 20% is many.