Understanding Medicare Surcharge (IRMAA) and Its Impact on P&G Employees
Navigating retirement can be complex, especially when managing healthcare expenses. One area that often surprises retirees is the Medicare Income-Related Monthly Adjustment Amount (IRMAA), commonly referred to as the Medicare surcharge. For P&G employees, understanding how IRMAA works and taking steps to mitigate its impact can safeguard your financial health.
What is the Medicare Income-Related Monthly Adjustment Amount (IRMAA)?
IRMAA is an additional charge added to your Medicare Part B (medical insurance) and Part D (prescription drug coverage) premiums. This surcharge applies to higher-income individuals based on their Modified Adjusted Gross Income (MAGI) as reported on tax returns from two years prior. For instance, your 2024 premiums are determined by your 2022 MAGI [1].
How IRMAA Affects Medicare Part B and Part D Premiums
IRMAA introduces a tiered structure that increases premiums as your income rises above certain thresholds. These surcharges are significant and can considerably affect retirees' cash flow [2].
Detailed Breakdown of 2024 IRMAA Premiums
Medicare Part B Monthly Premiums by Income
| MAGI Range (Single Filers) | MAGI Range (Joint Filers) | Part B Premium |
|---|---|---|
| $103,000 or less | $206,000 or less | $174.70 |
| $103,001–$129,000 | $206,001–$258,000 | $244.60 |
| $129,001–$161,000 | $258,001–$322,000 | $349.40 |
| $161,001–$193,000 | $322,001–$386,000 | $454.20 |
| $193,001–$499,999 | $386,001–$749,999 | $559.00 |
| $500,000 or more | $750,000 or more | $594.00 |
Medicare Part D Premium Surcharges by Income
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Brad Morgan
Hi there! 👋🏼 I'm Brad, a former Procter & Gamble employee turned financial advisor. With a focus on tax planning, I've been a trusted advisor for the P&G community for over ten years.
Citations:
[1] https://www.healthline.com/health/medicare/irmaa-brackets
[2] https://www.cms.gov/newsroom/fact-sheets/2024-medicare-parts-b-premiums-and-deductibles
[3] https://www.medicalnewstoday.com/articles/how-to-avoid-irmaa
[4] https://smartasset.com/retirement/form-ssa-44
[6] https://abacuswealth.com/managing-medicare-costs-strategies-to-tackle-irmaa/
[7] https://www.nerdwallet.com/article/insurance/medicare/what-is-the-medicare-irmaa
[8] https://flagstonefm.com/understanding-medicare-irmaa-a-retirees-guide/
Disclosure: Material prepared herein has been created for informational purposes only and should not be considered investment advice or a recommendation. Information was obtained from sources believed to be reliable but was not verified for accuracy. It is important to note that federal tax laws under the Internal Revenue Code (IRC) of the United States are subject to change, therefore it is the responsibility of taxpayers to verify their taxation obligations.
Understanding Medicare Surcharge (IRMAA) and Its Impact on P&G Employees
Navigating retirement can be complex, especially when managing healthcare expenses. One area that often surprises retirees is the Medicare Income-Related Monthly Adjustment Amount (IRMAA), commonly referred to as the Medicare surcharge. For P&G employees, understanding how IRMAA works and taking steps to mitigate its impact can safeguard your financial health.
What is the Medicare Income-Related Monthly Adjustment Amount (IRMAA)?
IRMAA is an additional charge added to your Medicare Part B (medical insurance) and Part D (prescription drug coverage) premiums. This surcharge applies to higher-income individuals based on their Modified Adjusted Gross Income (MAGI) as reported on tax returns from two years prior. For instance, your 2024 premiums are determined by your 2022 MAGI [1].
How IRMAA Affects Medicare Part B and Part D Premiums
IRMAA introduces a tiered structure that increases premiums as your income rises above certain thresholds. These surcharges are significant and can considerably affect retirees' cash flow [2].
Detailed Breakdown of 2024 IRMAA Premiums
Medicare Part B Monthly Premiums by Income
| MAGI Range (Single Filers) | MAGI Range (Joint Filers) | Part B Premium |
|---|---|---|
| $103,000 or less | $206,000 or less | $174.70 |
| $103,001–$129,000 | $206,001–$258,000 | $244.60 |
| $129,001–$161,000 | $258,001–$322,000 | $349.40 |
| $161,001–$193,000 | $322,001–$386,000 | $454.20 |
| $193,001–$499,999 | $386,001–$749,999 | $559.00 |
| $500,000 or more | $750,000 or more | $594.00 |
Medicare Part D Premium Surcharges by Income
Meet
Brad Morgan
Hi there! 👋🏼 I'm Brad, a former Procter & Gamble employee turned financial advisor. With a focus on tax planning, I've been a trusted advisor for the P&G community for over ten years.
Citations:
[1] https://www.healthline.com/health/medicare/irmaa-brackets
[2] https://www.cms.gov/newsroom/fact-sheets/2024-medicare-parts-b-premiums-and-deductibles
[3] https://www.medicalnewstoday.com/articles/how-to-avoid-irmaa
[4] https://smartasset.com/retirement/form-ssa-44
[6] https://abacuswealth.com/managing-medicare-costs-strategies-to-tackle-irmaa/
[7] https://www.nerdwallet.com/article/insurance/medicare/what-is-the-medicare-irmaa
[8] https://flagstonefm.com/understanding-medicare-irmaa-a-retirees-guide/
Disclosure: Material prepared herein has been created for informational purposes only and should not be considered investment advice or a recommendation. Information was obtained from sources believed to be reliable but was not verified for accuracy. It is important to note that federal tax laws under the Internal Revenue Code (IRC) of the United States are subject to change, therefore it is the responsibility of taxpayers to verify their taxation obligations.
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