IRMAA brackets and Medicare premiums in retirement
**IRMAA** (Income-Related Monthly Adjustment Amount) adds surcharges to Medicare Part B and D premiums when Modified Adjusted Gross Income (MAGI) exceeds annual thresholds. Brackets are indexed over time â planning with frozen 2020 dollars understates future surcharges.
What counts toward MAGI
For many retirees, MAGI includes AGI plus tax-exempt interest. Large Roth conversions, RMDs, and capital gains can push you into a higher bracket for **two years** (Medicare uses tax return from two years prior).
Why brackets drift
CMS publishes updated thresholds; CPI indexing means a â$109kâ cliff in 2026 is not the same real hurdle as years ago. Retirement models should escalate brackets, not freeze them.
Planning tactics (education only)
- Spread Roth conversions across years to stay under cliffs.
- Time capital gains and RMDs with bracket awareness.
- Model Medicare as a recurring expense that jumps at MAGI tiers.
Quala's tax engine emphasizes CPI-indexed IRMAA in lifecycle projections â not financial advice; verify with your tax professional.