My Advice
 

Everyone's personal financial situation is different.

As someone who does retirement income planning and tax preparation my advice would be to work with a qualified professional to come up with your plan.

Tom

Because we both worked in 2022 and had significant income we were assessed an IRMAA penalty for our Medicare premiums for 2023. We appealed that assessment because we no longer have that income and we’re successful in getting it reduced. It was a fairly simple process just filled out some paperwork and dropped it off at Leesburg Social Security office.

I read somewhere that the IRMAA adjustment is a two year thing, not a one year thing. Was that information wrong?

Did your adjustment get approved based on a qualified life changing event (ie marriage, etc)?

Your information is correct. The income reported for 2021 would affect your Medicare premium for 2023. Your 2022 income would not even be known to the IRS until you filed your 2022 tax return on April 15, 2023.

I pay the same income-based percentage for Medicare that I paid when I was working. A benefit of my workplace before I retired is supplemental Blue Cross insurance for $114 a month for the rest of my life. I also pay several hundred a year for vision and dental insurance. Last year I needed two major surgeries, for which I was billed about $140,000. My supplemental insurance and Medicare paid about 10% of that. I paid under $300 total. I’m VERY happy.

It changes yearly due to your AGI for the year they are using.

advantage
 

advantage can limit where you can go like to some specialists

Income tax rates are relatively low right now and that may not always be the case. So, we have been doing accelerated withdrawals out of our IRA's, well above the minimum needed, so we have been really taking it in the shorts on Medicare premiums. The increases are substantial. We won't know for at least a couple more years how automatic the drop back to normal will be.

And those income thresholds I found on the web today are

$97k for an individual and $194k for married creating a part B premium of $164 monthly
$123k single and $246k married part B $231
$153k single and $306 married and part B $329
And a few more thresholds beyond this

The biggest issue most people stumble into is today they are married so income thresholds are not being hit… I.e RMDs and other incomes are say $100k but when a spouse dies, they still are pulling RMDs of $100k but are now over the $97k threshold Triggering IRMAA increases. remember it is a threshold so if you make $97,001 or $122,999 you are into the next bracket…

This year as I am retired, wife is still working and we are selling a rental property, we are already into a higher threshold in 2 years when we start taking Medicare, we will be converting IRAs up to the top of the threshold and to not go over.

Yes exactly what you stated. I made money in the Stock Market in 2020 and boosted my income up Al lot, into another tax bracket. It takes 2 years to have an effect on Medicare cost. My Medicare cost for 2022 went up over $300. Yeah crazy. For 2023 my Medicare cost went down because my income was down for 2021.

If a couple owns assets separately, outside of IRAs, in taxable accounts....

....and one sells something owned individually -- stocks for instance....

....and the sale gets hit with the capital gain tax, causing one to cross the MAGI threshold.....

.....even if you file separately for that year, so one of you can stay under the threshold, as I understand it, IRMAA gets you both.

(I asked an accountant this one a while back. She said that is how it works. Can't dodge IRMAA by filing separately, even if you think you can make the numbers work. I say NO FAIR!

I hope the accountant was wrong, but I doubt it because I think I was making my question very clear. Does anybody here know about that?)

Boomer

I'm not certain, but I think the accountant is correct. Here is a link to the 2023 IRMAA income brackets. Three of the brackets indicate "N/A" under married filing separately.

Why Filing Taxes Separately Could Be A Big Mistake (when on Medicare) — Medicare Mindset, LLC

I don't think any of the IRMAA rules are fair. Some people are paying 3 to 4 times as much for the exact same Medicare coverage. It's like asking you how much money you make when you buy a car, and basing the price on your income.

NO traditional with a supp are much better overall Advantage plans can change drs on you you are locked in if you are certain meds and want to switch back to original If they deciede NO to a surgury and dr says yes you will NOT have that surgery without trying physical theraphy first they are not as good as you think if and whe you need it.........they changed my folks drs all the time and they had to fight every year to stay with them.......

I appreciate your comment. When I go on about taxes -- because I like to -- I always include a disclaimer that says it is possible that I have no idea what I am talking about and professional advice is in order.

You said it so nicely. Classy. So often in threads like this, there are posters who chime in with rude one-liners designed only to try to make those who ask questions feel dumb for asking the gen pop on TOTV about financial matters.

I think threads like this can be really helpful because the informative discussions, that often follow, can give the OP a starting point, along with a working vocabulary, to put together a list of questions for a professional.

It's so much better to pick up what you can and think things through instead of going in cold to meet with an accountant/planner. Being prepared saves meeting time, makes communication better, and is the key to a clear understanding of professional advice.

Some of us TOTVers do what we can to try to help when questions are asked.

Boomer