Avoid IRMAA fees by reducing your taxable income
If you will be enrolling in Medicare in the next few years, the best course of action is to examine your taxable income a minimum of 2 years prior to enrolling in order to avoid IRMAA premium surcharges. Our team of financial professionals will work with you to create a comprehensive plan that implements tax-saving strategies to help you reduce your taxable income. Alongside our Medicare Specialist, our Investment Team will thoroughly review your financial plan as a whole and suggest changes that will impact your premiums — thus saving you money over time.
What is IRMAA?
If you’re a Medicare beneficiary with a higher-than-average income, the Social Security Administration (SSA) could tack an extra charge onto the Medicare premiums you pay each month. These extra fees are called an Income-related Monthly Adjustment Amount (IRMAA). IRMAA charges are based on your income from your tax return. The SSA calculates the IRMAA amount using your Modified Adjusted Gross Income (MAGI) according to your tax returns from 2 years ago. You can use certain strategies, both before and after receiving an IRMAA, to reduce or eliminate this surcharge.
What are the best tips to avoid an IRMAA?
- Inform Medicare if you’ve had a life changing event that affected your income
- Avoid certain income-boosting changes to your annual income
- Utilize medical savings accounts such as the HSA or FSA
- Consider a Qualified Charitable Distribution (if eligible)
- Explore tax-free income streams
- Maximize your pre-tax retirement plan contributions if still working
Have more questions about how to reduce your taxable income? Or interested in a consultation? Click here to contact us now.
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How to Avoid Medicare’s IRMAA Premium Surcharge
Article from healthline.com
If you’re a Medicare beneficiary with a higher-than-average income, the Social Security Administration (SSA) could tack an extra charge onto the Medicare premiums you pay each month. Click here to read this article.
Blog by Greg Storen, MBA – President/CEO, Advisory Services Director
Learn more about Greg and the rest of the Storen Financial team here.