The IRMAA Two-Year Lookback, Explained
How the two-year lookback works
Medicare does not wait for this year's tax return. The Social Security Administration (SSA) uses the most recent return the IRS can send. That is usually two years old, and never more than three (SSA POMS HI 01101.010). Our workshop slide put it this way:
- 2024: the year you earn the money.
- 2025: the year you file, and the IRS reports it to SSA.
- 2026: the year you pay the premium.
The income SSA uses is your modified adjusted gross income (MAGI). For IRMAA, MAGI is your adjusted gross income (line 11 of Form 1040) plus tax-exempt interest (line 2a) (SSA POMS HI 01101.010). Municipal bond interest counts, even though it is not taxed.
If SSA used a three-year-old return because the newer one was not in yet, SSA says to call or visit and it will update its records (SSA, checked October 14, 2026).
The 2026 IRMAA brackets
These are the 2026 monthly amounts per person, based on 2024 MAGI (CMS, November 14, 2025). The Part D amount is added on top of your drug plan's own premium.
| 2024 MAGI, single | 2024 MAGI, married filing jointly | 2026 Part B total | 2026 Part D add-on |
|---|---|---|---|
| $109,000 or less | $218,000 or less | $202.90 | $0 |
| over $109,000 to $137,000 | over $218,000 to $274,000 | $284.10 | $14.50 |
| over $137,000 to $171,000 | over $274,000 to $342,000 | $405.80 | $37.50 |
| over $171,000 to $205,000 | over $342,000 to $410,000 | $527.50 | $60.40 |
| over $205,000 and under $500,000 | over $410,000 and under $750,000 | $649.20 | $83.30 |
| $500,000 or more | $750,000 or more | $689.90 | $91.00 |
Each line is a cliff. One dollar over a threshold puts you in the whole next tier. Married people who file separately and lived together use a different, steeper table (CMS).
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Bill and Mary's one-time rental sale
This is a hypothetical example using 2026 figures. Bill and Mary are married, both on Medicare, and file jointly. In a normal year their MAGI is about $150,000. That is under the $218,000 joint threshold, so each pays the standard $202.90 a month for Part B in 2026 (CMS).
In 2024 they sold a rental house. The gain pushed their 2024 MAGI to $300,000 for that one year. Because of the lookback, that 2024 return sets their 2026 premiums. $300,000 falls in the joint tier over $274,000 to $342,000.
| Per person, per month, 2026 | Normal year (MAGI $150,000) | Sale year (MAGI $300,000) |
|---|---|---|
| Part B premium | $202.90 | $405.80 |
| Part D add-on | $0 | $37.50 |
| Extra cost per person | $0 | $240.40 |
| Extra cost for the couple, full year 2026 | $0 | $5,770 |
The arithmetic: $405.80 minus $202.90 is $202.90 more for Part B, plus the $37.50 Part D add-on, for $240.40 a month each. Times 2 people times 12 months is $5,769.60, or about $5,770 for 2026.
The good news is that IRMAA is set one year at a time. If their 2025 MAGI is back to about $150,000, their 2027 premiums would very likely return to the standard amount. The 2027 brackets have not been announced yet, so that last step is an expectation, not a fact.
Note what does not help here. A home or property sale is not a life-changing event in SSA's rules, so Bill and Mary cannot ask SSA to use a lower year. They pay the 2026 surcharge.
What counts as one-time income
Anything that raises your adjusted gross income or your tax-exempt interest raises MAGI (SSA POMS HI 01101.010). Common one-time spikes include:
- a large IRA or 401(k) withdrawal,
- a Roth conversion (the taxable amount converted counts as income),
- the sale of a rental, a business or other property,
- a large capital gain from selling stocks or funds.
So yes, a Roth conversion can affect IRMAA. A conversion done in 2026 shows up on your 2026 return and can raise your 2028 premiums.
Does a $3,000 check really look like $2,000?
Our workshop slide said that with IRMAA, a $3,000 Social Security check can feel more like $2,000. Here is the honest math for one person in 2026. SSA takes the Part D add-on out of your Social Security check (SSA). For this example, assume Part B comes out of the check too.
- Standard premium: $3,000 minus $202.90 = $2,797.10 a month.
- Middle tier (single MAGI over $137,000 to $171,000): $3,000 minus $405.80 minus $37.50 = $2,556.70.
- Top tier (single MAGI $500,000 or more): $3,000 minus $689.90 minus $91.00 = $2,219.10.
So at the very top, about $781 a month goes to Medicare, and the check is closer to $2,200 than $2,000. That is before any drug plan premium or tax withholding. The surcharge is real, but the slide rounded it up.
Why the year you turn 63 matters
Because of the lookback, your first Medicare premiums at 65 are based on your income at 63. If you turn 65 in 2028, your 2028 premiums will generally use your 2026 return. A big sale or conversion at 63 can follow you into your first Medicare years.
Spreading income over several years can keep each year under a threshold. For example, a couple with $150,000 of MAGI has $68,000 of room under the 2026 joint threshold of $218,000. The thresholds move: they were $194,000, $206,000, $212,000 and $218,000 for 2023 through 2026 (SSA POMS HI 01101.010). A tax professional can model this year by year. Our how to avoid IRMAA guide covers more.
When SSA will use a newer, lower year
You can ask SSA to use a more recent year only if you had a life-changing event that lowered your income. SSA lists eight (SSA POMS HI 01120.001):
- death of a spouse,
- marriage,
- divorce or annulment,
- work reduction,
- work stoppage, such as retiring,
- loss of income-producing property,
- loss of employer pension income,
- receipt of an employer settlement payment.
You report it on Form SSA-44 (SSA-44), with proof such as a death certificate or a letter from your employer (SSA, checked October 14, 2026). A one-time sale, a big capital gain or a Roth conversion is not on the list. SSA will also update your premium if you filed an amended return or the IRS data was wrong. Our IRMAA appeal guide walks through the form.
2027 IRMAA brackets: not announced yet
As of October 14, 2026, the 2027 Part B premium and IRMAA brackets have not been published. CMS usually releases them in the fall, often in November. 2027 premiums will generally be based on 2025 MAGI. Until CMS announces the official numbers, see our 2027 IRMAA bracket projections, which are estimates.
Steps to take before a big income year
- Write down your normal MAGI. Add AGI and tax-exempt interest from your last return.
- Find your distance to the next threshold. Use the table above as a guide.
- Count back two years. Income this year sets premiums two years from now.
- Ask whether the income can be spread. Conversions and some sales can be split over years.
- If income drops for a listed reason, file Form SSA-44. Do not wait for the next year.
- Keep the surcharge in proportion. A tax professional can weigh a one-year surcharge against the tax saved by the move.
These numbers change every year
The IRMAA brackets, the standard deduction and the senior deduction are all adjusted annually, and the 2027 figures are published late in 2026. The one exception is the Social Security taxation thresholds, which have not moved since 1983 and are not expected to.
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Check your IRMAA tier
Enter your MAGI and filing status to see which 2026 tier you fall in and what it costs per year.
Open the IRMAA calculator →Sources
- CMS: 2026 Medicare Parts A and B Premiums and Deductibles (November 14, 2025)
- SSA: Premiums, Rules for Higher-Income Beneficiaries (checked October 14, 2026)
- SSA POMS HI 01101.010: Modified Adjusted Gross Income (December 2, 2025)
- SSA POMS HI 01120.001: New initial determinations on IRMAA (June 5, 2026)
- SSA: Request to lower an IRMAA (checked October 14, 2026)
- SSA: Form SSA-44, Life-Changing Event (checked October 14, 2026)
Frequently asked questions
What is the IRMAA lookback period?
Two years. SSA generally uses the tax return from two years before the premium year, so 2026 premiums are based on 2024 income. If that return is not available, SSA may use the one from three years before.
Does a Roth conversion affect IRMAA?
Yes. The taxable amount converted is added to your adjusted gross income, which raises MAGI. A 2026 conversion can raise your 2028 Medicare premiums.
Is a one-time capital gain a life-changing event for IRMAA?
No. SSA's eight life-changing events include retirement, death of a spouse, marriage and divorce, but not a sale, a capital gain or a conversion. You pay the higher premium for that year.
How long does an IRMAA surcharge last?
IRMAA is set one year at a time. If your income returns to normal, the surcharge usually ends two years after the high-income year.
What income counts for IRMAA?
Modified adjusted gross income: your AGI from Form 1040 line 11 plus tax-exempt interest from line 2a.
Are the 2027 IRMAA brackets out?
Not as of October 14, 2026. CMS usually announces them in the fall, often in November.
Want to run these numbers for your own situation?
The Retirement Literacy Foundation runs free retirement classes on Social Security timing, taxes in retirement, and how to turn savings into income. No products are sold at our classes.
The Retirement Literacy Foundation is a 501(c)(3) nonprofit. This guide is general education, not individualized tax, legal or investment advice. Rules change with legislation and IRS and SSA guidance, and the right move depends on your situation. Check anything you plan to act on with SSA, the IRS or a qualified tax professional.
Hans Goldstein, EA
Founder & Executive Director · Retirement Literacy Foundation, a 501(c)(3) non-profit
Admitted to practice before the IRS
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