Most retirees on Medicare are paying $202.90 a month for Part B coverage in 2026. A smaller group pays $689.90. That gap of nearly $487 a month stems from IRMAA (Income-Related Monthly Adjustment Amount), a rule that catches many retirees off guard because of financial decisions made years earlier.
Your 2024 Tax Return Sets Your 2026 Premium
Medicare looks back two years. Your 2026 Part B premium is based on your 2024 Modified Adjusted Gross Income (MAGI). For single filers, the standard $202.90 premium rate applies only if your 2024 MAGI was $109,000 or below. Cross that line by one dollar and the surcharge kicks in immediately.
A single filer at $109,001 pays $284.10 a month, an $81.20 jump for one dollar of extra income. Over a year, that is $974 more. For a couple where both spouses are on Medicare, the same one-dollar overage costs $1,948 extra per year.
The 2026 tier structure for single filers:
- $109,000 or below: $202.90/month
- $109,001 to $137,000: $284.10/month
- $137,001 to $171,000: $405.80/month
- $171,001 to $205,000: $527.50/month
- $205,001 to $500,000: $649.20/month
- Above $500,000: $689.90/month
For married couples filing jointly, all thresholds double.
Three Income Events That Trigger Higher Tiers
What you don’t know can cost you. A large Roth conversion adds directly to MAGI in the year it happens, showing up in your Medicare premium two years later. Selling a home with gains above the $500,000 couples exclusion pushes the excess into MAGI. Required minimum distributions (RMDs), which retirees must take from traditional IRAs starting at 73, can nudge income over a threshold.
The 2026 standard premium already reflects a 9.7% increase from 2025, consuming a meaningful share of the 2.5% COLA applied to Social Security benefits this year. For the average retired worker receiving $2,076 a month, that math leaves little room before IRMAA surcharges sting.
Appeal Your Surcharge If Your Income Dropped
There are exceptions. If your income fell significantly due to retirement, death of a spouse, or divorce, you can ask Social Security to use your current-year income instead of the two-year-old return. The form is SSA-44, and filing it can eliminate or reduce a surcharge that no longer reflects your actual finances.
The most common mistake is accepting the IRMAA determination without questioning it. If your income fell sharply after retirement and you are still charged based on peak earning years, an appeal is worth filing. The savings can reach several thousand dollars a year.
Every situation differs. A strategy that keeps one retiree below the $109,000 threshold might not work for someone with a pension, rental income, or a large IRA. Without the right strategy, small planning decisions made years before Medicare enrollment can come back to haunt you in the form of higher Part B premiums.
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