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Roth Conversions and IRMAA: The 2026 Medicare Surcharge Brackets, Explained
IRMAA in 2026
Medicare premiums are the one tax bracket most retirees never see coming, because it arrives as a letter from Social Security two years after the income that caused it. For a household doing Roth conversions or realizing gains, the income-related monthly adjustment amount is often the largest hidden cost in the plan.
Published September 11, 2026 by Flames Financial Planning. 9 min read.
Short answer: In 2026, a couple whose 2024 modified adjusted gross income exceeded $218,000 ($109,000 for a single filer) pays more for Medicare Part B and Part D, in tiers that add between $2,297 and $13,872 a year per couple. A Roth conversion, a large capital gain or a required distribution counts in full. The surcharge is a cliff, not a slope: one dollar over a threshold buys the entire tier. Plan income two years ahead, and if your income fell because you retired, file Form SSA-44 to have the surcharge recalculated.
What it is
How Medicare Sets Your Premium From Your Tax Return
Medicare Part B (doctors and outpatient care) has a standard premium, $202.90 a month in 2026, and Part D (prescription coverage) has a plan premium. Higher-income beneficiaries pay an additional amount on each, called the income-related monthly adjustment amount, or IRMAA.
Social Security decides who pays it by asking the IRS for your modified adjusted gross income from the return two years before the premium year. For 2026 premiums that is the 2024 return; the income you report for 2026 will set your 2026 premiums. If the IRS has no return for that year yet, Social Security uses the year before. Source: Social Security Administration, Medicare premiums: rules for higher-income beneficiaries.
Modified adjusted gross income for this purpose is adjusted gross income plus tax-exempt interest. That definition matters: municipal-bond interest counts, even though it is not taxed. Roth IRA distributions do not count, because they are not in adjusted gross income. A Roth conversion counts in full in the year it is made.
The surcharge is assessed per person. A married couple both on Medicare pays it twice, on the same joint income.
The 2026 table
The 2026 IRMAA Tiers for Part B and Part D
From the Centers for Medicare & Medicaid Services' 2026 premium announcement. The Part B figure is the total monthly premium including the standard $202.90; the Part D figure is the adjustment added to whatever your drug plan charges.
| 2024 MAGI, joint return | Single return | Part B monthly premium | Part D monthly adjustment | Extra cost per person, per year |
|---|---|---|---|---|
| $218,000 or less | $109,000 or less | $202.90 | none | none |
| over $218,000 up to $274,000 | over $109,000 up to $137,000 | $284.10 | $14.50 | $1,148 |
| over $274,000 up to $342,000 | over $137,000 up to $171,000 | $405.80 | $37.50 | $2,885 |
| over $342,000 up to $410,000 | over $171,000 up to $205,000 | $527.50 | $60.40 | $4,620 |
| over $410,000 up to $750,000 | over $205,000 up to $500,000 | $649.20 | $83.30 | $6,355 |
| over $750,000 | over $500,000 | $689.90 | $91.00 | $6,936 |
Married people filing separately who lived with their spouse face the top two tiers from $109,000 of MAGI. Part B annual deductible: $283. Source: CMS, 2026 Medicare Parts A & B premiums and deductibles. The thresholds are indexed each year; confirm the current table before acting.
For a couple, double the last column: the second tier costs $2,297 a year, the third $5,770, the fourth $9,240, the fifth $12,710 and the top tier $13,872. Because each tier is a fixed amount, the cost of crossing a threshold by one dollar is the same as crossing it by $50,000: the whole tier. That single fact drives most IRMAA planning.
What counts
What Pushes You Into a Tier, and What Does Not
| Counts toward MAGI | Does not count |
|---|---|
| Roth conversions, in full, in the year converted | Roth IRA distributions (qualified) |
| Required minimum distributions and any other IRA or 401(k) withdrawal | Qualified charitable distributions, up to $111,000 in 2026 after 70½ |
| Realized capital gains, including a home sale above the exclusion | Home-sale gain within the $500,000 joint exclusion |
| Dividends, interest and tax-exempt municipal interest | Growth inside any account until it is realized or distributed |
| Pension income, wages, business income, the taxable part of Social Security | Return of principal from a brokerage account (only the gain counts) |
| Rental income and most annuity payouts | Loans, including a reverse mortgage or a securities-backed line |
Qualified charitable distribution limits: IRS, Notice 2025-67 (2026 amounts relating to retirement plans and IRAs). Home-sale exclusion: IRS, Topic no. 701, Sale of your home.
Two entries surprise people. Municipal-bond interest, bought for its tax exemption, counts in full for IRMAA. And a home sale can count: a couple selling a long-held house for a $800,000 gain excludes $500,000 and reports $300,000, which alone can move them two tiers for a year, two years later. Capital gains also carry their own rate schedule (0% up to $98,900 of joint taxable income in 2026), covered in managing capital gains in retirement.
The calendar
Why IRMAA Planning Starts at 63
Medicare begins at 65. The first premium year is set by the return from two years earlier, so the return you file for the year you turn 63 is the first one that matters, and every return after it sets a premium year.
- Ages 59½ to 62: the clean window. Income in these years has no Medicare consequence. If Roth conversions are part of the plan, this is where the large ones belong, subject to the bracket arithmetic.
- Age 63 and 64: the first counted years. Income now sets premiums at 65 and 66. Many households retiring at 65 have their highest earnings in these years and are surprised by a surcharge in their first Medicare year. That surcharge is exactly what the life-changing-event appeal below exists for.
- Age 65 onward: every year counts. Conversions, gains and distributions each set a premium year two years out. A conversion plan that stops just under a tier, or clears it decisively in fewer years, is the goal.
- Age 70½: qualified charitable distributions. Giving directly from an IRA to charity, up to $111,000 in 2026, satisfies required distributions without adding to MAGI. For a charitable household this is the single most efficient IRMAA tool there is.
- Required-distribution age (73 or 75): the floor rises. Once distributions are mandatory, the income they create is no longer optional, which is why so much of this planning is about the balance that will exist on that day.
The appeal
When Your Income Fell: Form SSA-44
Because the lookback is two years, a household that retires in 2026 will be assessed 2028 premiums on 2026 earnings they no longer have. Social Security will use a more recent year if a "life-changing event" reduced your income.
The qualifying events are death of a spouse, marriage, divorce or annulment, work stoppage, work reduction, loss of income-producing property, loss or reduction of pension income, and receipt of an employer settlement payment. Retirement is a work stoppage. You file Form SSA-44 with an estimate of the more recent year's MAGI and evidence of the event, and Social Security recalculates the surcharge using that year. Sources: Social Security Administration, request to lower an income-related monthly adjustment amount; Social Security Administration, Form SSA-44.
What does not qualify
A one-time Roth conversion, a large capital gain, or a required distribution is not a life-changing event, even though it raised income for one year only. The surcharge that follows will stand for that premium year. That is why conversions and gains are planned rather than reacted to.
The appeal is also worth filing after the death of a spouse. The survivor is assessed as a single filer with half the threshold room, on a joint return from two years earlier that reflected two incomes; the death is a listed event.
Planning moves
Seven Ways Households Manage IRMAA
- Convert before 63, or convert decisively. Large conversions belong in the years before the lookback begins. After that, a conversion that will cross a tier anyway should cross it by a lot in one year rather than by a little in several; the tier costs the same either way.
- Aim just under a threshold when you can see it. With income known late in the year, a conversion or a gain can be sized to land a few thousand dollars below a tier ceiling. The ceilings for 2026 premiums are the 2026 table's, which will be published in the autumn before; plan against the current table with a margin.
- Use qualified charitable distributions after 70½. They reduce the taxable part of a required distribution dollar for dollar and never enter MAGI.
- Hold income-producing assets where they do not report. Bonds and high-dividend funds inside an IRA or Roth do not add to MAGI each year; the same holdings in a brokerage account do. This is asset location, covered in which investments belong in which account.
- Spend from the Roth in a high-income year. Roth distributions fund spending without adding to MAGI, so a year with a large gain or distribution can draw living expenses from the Roth instead of the IRA.
- Time a home sale. A gain above the exclusion is income in the year of sale. Where the choice exists, selling in a year with no conversion, or before 63, keeps the two events from stacking.
- File the appeal when you retire. It is the one part of IRMAA that is simply administrative, and it is missed constantly.
None of these is a reason to avoid income that is genuinely worth realizing. A $2,297 surcharge on a $150,000 conversion is about 1.5 percentage points on that conversion; the same surcharge on a $5,000 overage is about 46 points. The size of the income relative to the tier is what decides whether IRMAA is a footnote or the whole story.
Flames FP approach
How Flames FP Handles This
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FAQ
Common Questions
What are the 2026 IRMAA income limits?
The surcharges begin above $218,000 of modified adjusted gross income on a joint return and $109,000 on a single return, using the 2024 tax return. Tiers step up at $274,000, $342,000, $410,000 and $750,000 of joint MAGI ($137,000, $171,000, $205,000 and $500,000 single).
Does a Roth conversion count toward IRMAA?
Yes, in full, in the year of the conversion, because converted amounts are included in adjusted gross income. Distributions from the Roth IRA afterwards do not count, which is one of the long-run reasons to convert.
How much does IRMAA cost a married couple?
Both spouses pay it on the same joint income. In 2026 the second tier adds about $2,297 a year per couple for Part B and Part D combined, the third about $5,770, the fourth about $9,240, the fifth about $12,710 and the top tier about $13,872.
Can I appeal an IRMAA surcharge?
Yes, if a life-changing event reduced your income: retirement or reduced work, marriage, divorce, the death of a spouse, loss of income-producing property, loss of pension income or an employer settlement. File Form SSA-44 with Social Security. A one-time conversion or capital gain is not a qualifying event.
Does tax-exempt municipal bond interest count for IRMAA?
Yes. Modified adjusted gross income for Medicare purposes is adjusted gross income plus tax-exempt interest, so municipal interest counts in full even though it is not taxed.
Do qualified charitable distributions reduce IRMAA?
Yes. A qualified charitable distribution, up to $111,000 in 2026 for IRA owners 70½ and older, satisfies required distributions and is excluded from income entirely, so it never enters MAGI.
Keep reading
Related Reading
How aggressive should Roth conversions be?
Pacing conversions slice by slice against the brackets and the IRMAA tiers.
Planning for required minimum distributions at 73 or 75
The income that becomes mandatory, and the charitable route around it.
Retirement tax planning at Flames FP
Ongoing tax projections and Medicare-aware conversion modeling under a flat fee.
Primary sources
- CMS, 2026 Medicare Parts A & B premiums and deductibles
- Social Security Administration, Medicare premiums: rules for higher-income beneficiaries
- Social Security Administration, request to lower an income-related monthly adjustment amount
- Social Security Administration, Form SSA-44
- IRS, Notice 2025-67 (2026 amounts relating to retirement plans and IRAs)
- IRS, Retirement plans FAQs regarding IRA distributions
- IRS, Topic no. 701, Sale of your home
- IRS, tax year 2026 inflation adjustments (Rev. Proc. 2025-32)
This article is educational and is not individualized tax, legal or investment advice. Thresholds, rates and premiums are revised every year; the figures here are for tax year 2026 as published by the sources above, and you should confirm the current year’s before acting on any of them. Advisory services are offered through Core Planning, LLC, a Registered Investment Advisor.