There will be circumstances where this SS increase could cause some Medicare recipients to need to be aware of the possibility of getting hit by IRMAA (Income-Related Monthly Adjusted Amount) if the 2023 AGI crosses IRMAA’s threshold(s).
But for those of RMD age and holding in the market, it is likely that the RMD will be less, so that could create a buffer zone.
IRMAA does not get everybody, but it can pay to be aware because crossing that income threshold means you’re going to pay more for Medicare — and it’s an in or out situation. IRMAA has gotcha once you cross that income line, and you then get hit with the premium increase 2 years later.
If charitably inclined and of RMD age, IRMAA possibly can be dodged by using QCDs as part of the RMD. QCDs do not show up as AGI.
If you are bringing in a tidy retirement income, or making a cap gain taxable profit on the sale of a secondary residence, or have sold stock outside of an IRA or Roth — and you have never heard of IRMAA — you might want to do a little homework — just in case.
Sometimes it could be just an all-in year and it’s worth paying IRMAA. But if the AGI crosses that line by even a small amount, IRMAA will get you just the same — and that probably is not worth it when a QCD could rescue you from IRMAA.
If you think I could be talking about you, but you are not sure, it could be worth doing a little income projecting to see if IRMAA is lurking in your future.
Boomer
PS: Note to Bay Kid who posted about the reduction in SS for a parent: I am wondering if that reduction was due to IRMAA. (Not my business, just a thought)
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