Medicare Planning Guide · 2026
How to Avoid IRMAA Surcharges in 2026: What Your CPA Should Be Modeling Before You Convert
IRMAA surcharges can add thousands of dollars per year to your Medicare costs — and the income that triggers them is determined two years in advance. Most retirees only find out after the fact. This guide explains what your planning team should be modeling right now, in 2026, before those decisions are locked in.
What Is IRMAA?
The Surcharge Most Retirees Don't See Coming
IRMAA — the Income-Related Monthly Adjustment Amount — is a Medicare premium surcharge applied to Part B and Part D when your modified adjusted gross income (MAGI) exceeds certain thresholds. In 2026, the surcharges are determined using your 2024 tax return, due to Medicare's two-year lookback rule.
For 2026, according to the Centers for Medicare and Medicaid Services (CMS), the standard Medicare Part B premium is approximately $185 per month. Retirees who cross the first IRMAA threshold can pay significantly more, and higher tiers can more than triple the standard premium. The surcharge applies per person, so married couples filing jointly can face compounded costs.
The core problem is timing. The income event that triggers an IRMAA surcharge in 2026 happened in 2024. If your advisor recommended a Roth conversion in 2024 without modeling the Medicare impact two years out, you may already be paying more than necessary this year. And if decisions made in 2026 go unmodeled, you may face the same surprise in 2028.
2026 IRMAA Brackets at a Glance
Based on 2024 MAGI. Figures are approximate; confirm current thresholds with CMS or a qualified advisor.
| 2024 MAGI (Individual) | 2024 MAGI (Married Filing Jointly) | 2026 Part B Monthly Premium (approx.) |
|---|---|---|
| Up to $106,000 | Up to $212,000 | ~$185 (standard) |
| $106,001 – $133,000 | $212,001 – $266,000 | ~$259 |
| $133,001 – $167,000 | $266,001 – $334,000 | ~$370 |
| $167,001 – $200,000 | $334,001 – $400,000 | ~$480 |
| $200,001 – $500,000 | $400,001 – $750,000 | ~$591 |
| Above $500,000 | Above $750,000 | ~$628 |
Source: CMS 2026 Medicare cost projections. Amounts shown are estimates; individual premiums may vary. Part D surcharges apply separately. Consult a qualified advisor for your specific situation.
The Problem With Disconnected Advice
Why So Many Retirees Pay IRMAA Unnecessarily
IRMAA surcharges are rarely the result of too much income. They are almost always the result of income events that nobody modeled against Medicare thresholds before they happened. That is a planning gap, not a math problem.
The Roth Conversion That Crossed a Threshold
An advisor recommends a Roth conversion in October. The conversion makes sense from a bracket-filling standpoint. But nobody checked whether it would push MAGI above the first IRMAA tier — triggering higher Medicare premiums two years later. The conversion was correct in isolation. In context, it was costly.
Hypothetical illustration for educational purposes only. Individual results vary.
The RMD That Pushed Income Over the Line
Required minimum distributions from IRAs are mandatory and non-negotiable — but their size and timing relative to other income sources can be managed. When RMDs are not modeled alongside Social Security, pension income, and investment distributions, the combined figure can unexpectedly cross an IRMAA bracket.
Hypothetical illustration for educational purposes only. Individual results vary.
The Capital Gain From a Portfolio Rebalance
An investment manager rebalances a taxable portfolio in December. The realized gains — even long-term gains — count toward MAGI and therefore toward IRMAA thresholds. When the portfolio manager and the tax team are not communicating in real time, this kind of income lands on the return as a surprise.
Hypothetical illustration for educational purposes only. Individual results vary.
The common thread: none of these were bad decisions on their own. They became expensive decisions because no one was looking at the full picture at the same time.
This is the coordination gap that proactive tax planning is designed to close — and it is why having your financial planner and CPA working from the same desk matters in retirement more than at any other stage of your financial life.
Understanding the Mechanics
The Two-Year Lookback Rule: Why You Are Always Planning Two Steps Ahead
Medicare determines your IRMAA surcharge based on your MAGI from two years prior. This is not a penalty — it is simply the administrative mechanism the Social Security Administration uses to set premiums. But the two-year gap creates a planning window that most retirees do not take advantage of.
Here is what that means in practical terms: the income events in your 2026 tax return will determine whether you face IRMAA surcharges in 2028. The decisions you make this year — Roth conversions, RMD timing, capital gain realization, QCDs, Social Security elections — all have a two-year forward shadow on your Medicare costs.
A well-coordinated planning team is not just managing your 2026 tax liability. It is simultaneously modeling the 2028 Medicare consequence of every income decision made today. That is what separates reactive tax preparation from proactive retirement income planning.
Note: If you experience a significant life-changing event (retirement, divorce, or death of spouse), you may qualify to request a review of your IRMAA determination. Contact Social Security directly or work with a qualified advisor to assess eligibility. Individual circumstances vary.
The IRMAA Timeline: How Today's Income Affects Future Premiums
2024 Tax Return
Your 2024 MAGI is what Social Security used to set your 2026 Medicare premiums. If a Roth conversion or capital gain pushed income above a threshold in 2024, you are paying IRMAA today.
2026 Decisions (Now)
Income events in your 2026 return (filed in early 2027) will determine your 2028 Medicare premiums. Roth conversions, RMDs, portfolio rebalancing, and QCDs decided this year all have a 2028 consequence.
2028 Medicare Premiums
Retirees who model IRMAA thresholds into their 2026 income planning may avoid surcharges two years from now. Retirees who do not will discover them on their Medicare statement.
What Your Planning Team Should Be Doing
Five Levers for Managing IRMAA in 2026
IRMAA is not unavoidable for every retiree. For those near a threshold, several planning levers may help manage modified adjusted gross income — but each requires coordination across your financial plan, tax return, and investment strategy. The right approach depends on your specific situation and involves trade-offs that should be evaluated with qualified guidance.
Roth Conversion Modeling: Size Matters as Much as Timing
A Roth conversion is one of the most powerful tools in retirement tax planning — but it also directly increases MAGI, which feeds into IRMAA thresholds two years later. The question is not simply whether to convert, but how much to convert in a given year without crossing a bracket boundary. A CPA and CFP working together can model the conversion amount against your projected income, your current bracket, and your IRMAA threshold simultaneously — finding the amount that makes sense for tax efficiency without triggering a premium increase two years out. Converting to just below a threshold, rather than an arbitrary round number, can represent meaningful savings over a retirement. Suitability varies by individual; this is not a recommendation for any specific strategy.
Qualified Charitable Distributions (QCDs): A Direct Income Offset
If you are age 70.5 or older, a Qualified Charitable Distribution allows you to transfer up to $108,000 per year (2026 limit, indexed for inflation, per IRS guidelines) directly from your IRA to a qualified charity. Unlike a standard charitable deduction, a QCD reduces your gross income directly — which means it reduces MAGI dollar-for-dollar. For retirees who are charitably inclined and taking RMDs, a QCD may satisfy part or all of the RMD while keeping income below an IRMAA threshold. This strategy requires careful coordination with your tax preparer to ensure the QCD is properly executed and reported on your return.
Withdrawal Sequencing: Which Accounts You Pull From (and When)
Not all retirement income counts the same way toward MAGI. Qualified distributions from Roth accounts are generally excluded. Interest and dividends from taxable accounts count in full. Traditional IRA and 401(k) withdrawals are fully includable. Designing your withdrawal sequence — the order and proportion in which you draw from taxable, tax-deferred, and Roth accounts — has a direct and compounding effect on your annual MAGI and therefore on your IRMAA exposure year over year. This is not a set-and-forget decision; it should be revisited annually as your account balances, income needs, and tax brackets evolve.
Capital Gain Timing and Tax-Loss Harvesting
Realized capital gains in taxable accounts count toward MAGI. A portfolio rebalance, a fund liquidation, or a sale of appreciated securities can all push income above an IRMAA threshold if not modeled in advance. When your investment manager and tax team share the same desk — reviewing your projected MAGI before executing trades — they can identify whether losses elsewhere in the portfolio could offset gains, whether a rebalance should be split across calendar years, or whether gains should be deferred. This kind of in-year coordination is only possible when the people making investment decisions and the people preparing your tax return are in continuous communication.
IRMAA Appeals and Life-Change Exceptions
If a one-time income event — such as a business sale, an inheritance, or a large capital gain in a single year — pushed you into a higher IRMAA tier, you are not necessarily locked in permanently. The Social Security Administration allows for an IRMAA appeal if you have experienced a qualifying life-changing event (retirement, reduction in work hours, divorce, death of a spouse, or loss of income). If you believe your current IRMAA surcharge is based on income that is no longer representative of your situation, contact the SSA directly or work with a qualified advisor to evaluate whether a Life Changing Event request is appropriate for your circumstances. Results and eligibility vary by individual situation.
The Coordination Difference
What Changes When Your Advisor and CPA Work Together
IRMAA planning is not a one-conversation item. It requires continuous coordination across every income decision made in a given year. Here is what that looks like in practice.
| Planning Decision | Separate Advisor and CPA | United FPG Integrated Team |
|---|---|---|
| Roth Conversion Sizing | Advisor recommends conversion; CPA sees the amount at filing in April | Conversion sized against MAGI threshold before execution; IRMAA impact modeled two years forward |
| RMD Planning | RMD calculated and distributed; interaction with other income rarely modeled in advance | RMD projected alongside Social Security and withdrawals; QCD opportunity identified and executed before year-end |
| Portfolio Rebalancing | Rebalance executed for allocation purposes; capital gains realized and reported at filing | Rebalance timed against projected MAGI; gains offset with harvested losses where available |
| IRMAA Threshold Review | Rarely modeled proactively; discovered when Medicare statement arrives | MAGI projection updated mid-year; income events reviewed against IRMAA brackets before year-end close |
| Multi-Year Tax Projection | Single-year focus; 2028 Medicare consequence of 2026 decisions rarely considered | Multi-year projection models 2026 decisions against 2027 and 2028 IRMAA brackets simultaneously |
The scenarios above are hypothetical illustrations for educational purposes only. They do not represent actual client outcomes. Individual results vary based on personal circumstances, tax situation, and applicable law.
About the Team Behind This Guidance
CPA and CFP Credentials on the Same Team — Not at Different Firms
At United Financial Planning Group, IRMAA planning is not an afterthought added to a retirement conversation. It is built into the standard retirement income modeling that our team performs for every client approaching or in retirement.
Jose Vivero, CFP®, ChFC®, CLU®, RICP®, holds the Retirement Income Certified Professional designation — a credential specifically focused on retirement income planning, including the interaction between income, taxes, and healthcare costs in retirement. His work at United FPG reflects exactly this kind of coordinated, forward-looking approach.
Gerry Barrasso, CPA, CFP®, PFS, founded United FPG specifically because he saw — from the CPA seat — how costly it was for clients to have a financial advisor and a tax preparer who never spoke to each other. His background at Price Waterhouse and more than 30 years of integrated planning experience shape the firm's approach to retirement income design.
When the same team manages your investment withdrawals, models your Roth conversions, and prepares your tax return, the two-year IRMAA lookback becomes a planning opportunity rather than an unwelcome surprise.
Jose Vivero, CFP®, ChFC®, CLU®, RICP®
Financial Advisor — Retirement Income Specialist
Jose holds the Retirement Income Certified Professional designation, one of the most advanced credentials in the field of retirement income planning. His work focuses on helping clients coordinate income streams, manage tax exposure, and plan for healthcare costs — including IRMAA — throughout retirement.
Gerry Barrasso, CPA, CFP®, PFS
President and Founder
Gerry began his career as a CPA with Price Waterhouse and has more than 30 years of experience integrating tax strategy with financial planning. He founded United FPG specifically to eliminate the gap between advisors and accountants — a gap that frequently surfaces as unexpected costs for retirees, including IRMAA surcharges.
United Financial Planning Group is a fee-only registered investment advisor. We do not earn commissions or sell insurance products. Our only compensation comes from client fees, which removes the product-sale conflicts that can distort retirement income recommendations.
Member: NAPFA, Garrett Planning Network, XY Planning Network, Fee Only Network, Wealthtender
What Our Clients Say
Selected reviews from verified Wealthtender Certified Advisor Reviews™ relevant to this topic — not representative of all client experiences.
Wealthtender Certified Advisor Review™
"Professional, Knowledge, Trustworthy Advisor"
My wife and I began working with Gerry in late 2014 prior to both if us entering retirement. Having spent over 35 years in the financial services industry I knew it was important to have independent fiduciary investment and tax advice. We researched and interviewed more than a few advisors and following our initial meeting with Gerry we both knew he would be a great fit for us. Among the reasons we decided to have Gerry manage our assets is his overall approach to working with clients. He is patient, listens, empathetic and explains things in a clear and straight forward manner. We also appreciate that Gerry is our CPA, thus giving him a complete understanding of our financial picture. Gerry developed a long-term plan that incorporated our income sources, investments and risk tolerances. Gerry has always made himself available to us for any questions or issues large or small. We believe that his approach to working with people filters to his staff (Patricia Watkins) who is also very capable and responsive. Transitioning to retirement can be challenging. During this phase, Gerry was instrumental in helping us navigate the many decisions we would be making going from full-time work to retirement. Of note was our decision to relocate from New York to Florida and the financial impact of that decision. Over the almost 10 years, Gerry has provided steady and informed advice especially during times of significant fluctuations in the global economy, stock and bond markets. We truly enjoy working with Gerry and have no hesitation to recommend him to others who require financial planning and/or tax planning services. Give him a call, you won't be disappointed.
Bob Porwick
Dec 7, 2023
Wealthtender Certified Advisor Review™
"It's like working with a friend."
My wife and I began working with Gerry 7 years ago when we decided we needed professional guidance in our investment portfolio. Gerry has been great in understanding our needs, which include college, wedding, and retirement planning. Gerry has the perfect demeanor to make us feel comfortable in discussing investment, tax, and strategic planning of our assets. He has a calm and gentle approach; he is well informed and on top of the current industry trends. I am particularly pleased to be able to use his software "Right Capital" to view our portfolio on-line and input "what if" scenarios to see if our retirement objectives are on track. With this software I can see a retirement success percentage which gives us comfort and our investments are meeting our expectations and goals. I would highly recommend Gerry to anyone looking for financial guidance both as a CFP and CPA you have the best of both worlds in investment strategy and tax implications. We look forward to many years working with Gerry to continue to grow our investments and secure a long and happy retirement. Jerry & Maria Dresel
Jerry Maria Dresel
Dec 15, 2023
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Common Questions
Frequently Asked Questions About IRMAA in 2026
What is an IRMAA surcharge?
IRMAA stands for Income-Related Monthly Adjustment Amount. It is an additional surcharge added to Medicare Part B and Part D premiums for beneficiaries whose modified adjusted gross income exceeds certain thresholds. The surcharge is determined by the Social Security Administration using your tax return from two years prior. For 2026 premiums, the SSA uses your 2024 MAGI. The surcharge increases in tiers, with higher-income retirees paying progressively more per month. The amounts shown in published bracket tables are approximate and may be updated annually; always confirm current figures with CMS or a qualified advisor.
At what income does IRMAA kick in for 2026?
For 2026, the first IRMAA surcharge tier is generally expected to apply when your 2024 MAGI exceeds approximately $106,000 for individuals or $212,000 for married couples filing jointly. These thresholds are adjusted periodically by CMS and should be confirmed with current CMS publications or a qualified advisor. Even crossing the first tier by a small amount can trigger a meaningfully higher monthly premium, which is why modeling your projected MAGI against these boundaries before year-end is important.
Do Roth withdrawals count toward IRMAA?
Qualified distributions from a Roth IRA are generally excluded from gross income and therefore do not count toward MAGI or IRMAA thresholds. This is one of the primary reasons why building Roth assets during lower-income years — through contributions or conversions — can be a meaningful IRMAA management strategy in retirement. However, the Roth conversion itself (moving money from a traditional IRA to a Roth IRA) does increase MAGI in the year of conversion. The IRMAA benefit comes two or more years later, once the converted funds are in the Roth and future distributions are tax-free. This dynamic is exactly why conversion sizing must be modeled against IRMAA brackets, not just income tax brackets.
How do I avoid IRMAA in 2026?
The 2026 IRMAA surcharge is already set based on your 2024 MAGI — so if you are already in a surcharge tier, that cannot be changed retroactively except through an appeal based on a qualifying life-changing event. What you can manage right now is your 2028 IRMAA, which will be determined by your 2026 income. The strategies available include: sizing Roth conversions to stay below threshold boundaries, using Qualified Charitable Distributions to reduce IRA withdrawals that would otherwise count toward MAGI, coordinating investment gain realization with harvested losses, and designing your withdrawal sequence to lean on Roth or taxable accounts rather than traditional IRAs when MAGI is already near a threshold. All of these require modeling and coordination across your financial plan and tax return — not one-time decisions made in isolation.
Can I appeal my IRMAA surcharge?
Yes, in certain circumstances. The Social Security Administration allows beneficiaries to request a review of their IRMAA determination if they have experienced a qualifying life-changing event that has significantly reduced their income. Qualifying events include retirement or reduction in work hours, divorce, death of a spouse, loss of income-producing property, and certain employer settlement payments. If the two-year-old tax return used to set your current surcharge no longer reflects your financial situation, you may be able to have your premium recalculated using more recent income information. Contact the SSA at 1-800-772-1213 or visit ssa.gov, or work with a qualified advisor to evaluate your eligibility. Results vary by individual situation.
What is the IRMAA income limit for 2026?
There is no single "income limit" for IRMAA — it is a tiered surcharge system where higher income results in progressively higher Medicare premiums. The first surcharge tier for 2026 begins at approximately $106,000 MAGI for individuals and $212,000 for married couples filing jointly (based on 2024 income). The highest tier applies above approximately $500,000 for individuals and $750,000 for married couples filing jointly. These figures reflect CMS estimates and should be confirmed with current agency publications. Surcharges apply separately to both Part B and Part D, so the total monthly impact at higher tiers can be significant for a married couple both enrolled in Medicare.
Related Planning Topics
IRMAA Is One Piece of Retirement Income Planning
Medicare premium planning is inseparable from your broader retirement income strategy. The same decisions that affect your IRMAA thresholds — Roth conversions, withdrawal sequencing, RMD timing — also determine your income tax bracket, your Social Security taxation, and the longevity of your portfolio. These topics are covered in depth across our services and planning resources.
Retirement Planning
How we coordinate withdrawal sequencing, Social Security timing, and Medicare planning into one connected retirement income strategy.
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Tax Planning
Year-round proactive tax strategies including Roth conversion modeling, bracket management, and capital gain coordination — before your return is filed.
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For Retirees
How our integrated CPA and CFP team approaches retirement income, RMDs, IRMAA, and tax-efficient distribution for clients already in retirement.
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Work With a Coordinated Team
Stop Finding Out About IRMAA on Your Medicare Statement
IRMAA surcharges are not inevitable for every retiree — but avoiding them requires modeling your income against Medicare thresholds before the year closes, not after the return is filed. At United Financial Planning Group, your CFP® professional and CPA work on the same team, reviewing every income decision against your IRMAA exposure in real time.
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