Dispute IRMAA after 401k withdrawal

Fisher

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SSA-44 doesn't have a good option to choose for someone who withdraws a large sum from a retirement account (401k, IRA, etc.) and gets dinged with IRMAA. Who knows the correct box to check on the form?
 

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SSA-44 doesn't have a good option to choose for someone who withdraws a large sum from a retirement account (401k, IRA, etc.) and gets dinged with IRMAA. Who knows the correct box to check on the form?
A 401k withdrawal is not a life changing event (in regard to IRMAA).
 
It does not seem to be an option. Not a qualifying event.

An increase in income, is not a qualifying event.
When I was looking into the 2 years into the future B increase due to a 1099-C for forgiven debt (which is taxed as ordinary income) I was told by SS that they would have to file a change of circumstances in 2 years (since that premium is based on income 2 years ago) so that their B premium would not go up (since they had the year of the 1099-C income that was over the limit for the usual "lowest" premium.

I am not sure how with drawing retirement money, since that is taxed unless it is a Roth IRA, wouldn't be dealt with the same way. What am I missing?
 
Info I neglected to include in the original post - I don't know if it matters... but common sense says it should--

The guy was 63 when he did the 401k withdrawal. He is T65 Mar 2025 and has the IRMAA notice for his upcoming Part B premium.
 
Info I neglected to include in the original post - I don't know if it matters... but common sense says it should--

The guy was 63 when he did the 401k withdrawal. He is T65 Mar 2025 and has the IRMAA notice for his upcoming Part B premium.
IRMAA is like an old girlfriend. Showing up two years later after you've moved on.

Worse case scenario, he's only looking at a one year increase. Unless he did it again.

I'd suggest an appeal anyway. He's appealing to SS and not Medicare. I've seen SS do some froggy things.

Anyway, check this out if you haven't already.
 
When I was looking into the 2 years into the future B increase due to a 1099-C for forgiven debt (which is taxed as ordinary income) I was told by SS that they would have to file a change of circumstances in 2 years (since that premium is based on income 2 years ago) so that their B premium would not go up (since they had the year of the 1099-C income that was over the limit for the usual "lowest" premium.

I am not sure how with drawing retirement money, since that is taxed unless it is a Roth IRA, wouldn't be dealt with the same way. What am I missing?

A 1099C for forgiven debt is essentially phantom income. Not money utilized for your lifestyle in the current tax year.

Retirement withdrawals are real income, used to fund your current living expenses, in the current tax year.

It's money used this year. Not money used decades ago.

Head over heels different.

---

Legally in the eyes of the IRS, a 1099C is not considered "earned income".

It is "taxable income". But not "earned income".
 
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IRMAA is like an old girlfriend. Showing up two years later after you've moved on.

Worse case scenario, he's only looking at a one year increase. Unless he did it again.

I'd suggest an appeal anyway. He's appealing to SS and not Medicare. I've seen SS do some froggy things.

Anyway, check this out if you haven't already.
Yeah, I told him to take documentation to the local SS office and see what happens. I think he's screwed, but like you say, Mr Haire, froggy things occur.
 
Info I neglected to include in the original post - I don't know if it matters... but common sense says it should--

The guy was 63 when he did the 401k withdrawal. He is T65 Mar 2025 and has the IRMAA notice for his upcoming Part B premium.
After some of our previous interactions, I have you on ignore but I happened to see this from outside the forum. I am ignoring the ignore for purposes of this and the previous post I have made in this thread.

The first mistake in your post above, which a regular and respected forum member poster points out from time to time, is attempting to use the terms "common sense" and "medicare", or the terms "common sense" and "social security" together.

Your basic issue is one that has been discussed here several times over the years. I am surprised you do not know this stuff. High levels of 401k withdrawals are not life changing events and leave a person with a year of IRMAA penalties.

I have been trying to understand and sort out retirement issues and have been listening to multiple youtube videos on retirement topics. This is an issue Financial Planners point out on a regular basis for RMD planning, high levels of RMDS will generate future IRMAA add ons to medicare premiums, so it is a commonly known issue and consideration "in the industry".

In one of the earlier discussions about this, I found and referenced a blog post by someone, I think Michael Kitces, that emphatically stated 401k withdrawals were NOT life changing events.

I believe a few agents may have seen clients have success in appealing this, but most often not.

When I see "all" the details of your situation after your second post, two things come to mind. They will involve a bit of deviousness to attempt to gloss over the fact that the "income bubble" comes from retirement plan distributions and not earned income. Others will have to help you with exactly how to word presentations.

First: Previous threads on IRMAA and underlying income have pointed out there is a procedure to ask SSA to use the income from one year ago, rather than two years ago, for the income base for IRMAA determination. (This does require the tax return for that year to have been filed.)

So, in your case, your client would refer to his income for the tax year he was 64 and ask that that be considered instead of the return for his age 63 because the age 63 one was an unusual aberration.

Second, Retirement, with presumably lower income, is a life changing event. An appeal using a combination of the Part B effective date and the planned retirement date along with a check in the work stoppage box might work to get the IRMAA taken away.
 
Because of the "internet presence" of Insurance Forums, I think it is possible consumers who are not members of the forum might stumble on this thread.

There are two additional places I might try as a consumer for help.

Dr Ed Weir's Social Security and Medicare support group Chapter. (With the understanding they are agents for Medicare products.)

See if Laurence Kottlikoff and Terry Savage have a Social Security and Medicare consumer help site.
 
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