How to Avoid IRMAA the Right Way! | Medicare IRMAA Calculation Explained

Timestamps:
0:00 Medicare Premium Increases in Retirement?
0:22 What is IRMAA?
1:17 Planning For IRMAA Brackets We Don't Yet Know
2:11 Two Examples Showing the Importance of Planning for IRMAA
6:37 How is IRMAA Calculated?
10:03 The 2024 IRMAA Brackets?

#Medicare #retirementincomeplanning
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Always remember, "You Don't Need More Money; You Need a Better Plan"

[pensacola]

I get IRMMA next year. You know what? Do the best you can, and live your life. This stuff can drive you crazy and you'll still lose...

[fbm]

Yes u bring up a sore point, ive experienced this bs. This is pure evil on the people and needs fixed!

[Lukionest]

Good video. One minor correction to the calculations shown at 10:06 is that for married filers with income in the 5th zone, the IRMAA bracket is set at $750, 000 and is not currently adjusted for inflation. It is fixed at that static amount until 2029 when it will then begin to inflation adjusted like the other zones (unless changed by legislation between now and then.) For single filers, the 5th zone remains at $500, 000 until 2029.

[joselabiosa]

Great content! In addition, you are an awesome teacher. Thank you.

[Paul-GrnHil]

Great Video. It took me a bit to confirm the math and source the data but once I did, I was able to build an excel sheet with the CPI-U data up through Jan 2023. I then assumed each month in the future inflation increases 1/12th of 2% (The Fed target Rate) I estimate the first IRMAA tier for a singe filer increase from $97, 000 in 2021 income to $102, 000 and $104, 000 for 2022 & 2023 respectively. This allows me to increase my 2023 Roth conversion conservatively by $14k as a MFJ filer. 
I have already made a significant Roth conversion in January. I will continue to update the table and in December, I will be able to make an additional end of year conversion once I have a better picture of my other income and the latest IRMAA inflation data. This video was incredibly helpful.

[michaelmclaughlin]

Thank you. I thought these brackets were usually announced before the end of the year for the 2 year look ahead. How naive of me! I’m trying to maximize my use of the second bracket. I’m not sure of my total interest in one for this year therefore I’m going to use $160k as my target. Very frustrated I need to do this with so much uncertainty.

[randolphh]

Great review! And yes please see if you qualify to appeal. It’s possible under specific life events, including a big reduction in earned income due to retirement or going part time. We saved nearly $2000 by appealing last year, and will appeal again this year for a further reduction

[jamesy]

Can’t you just imagine abbot and Costello doing a routine on how Lou calculated his Social Security! 🤣🤣, I recommend pausing the video and jumping off your deck 😊

[Zues]

I tried to use your calculation to come up w/the 2024 IRMAA base line of $103, 000, using the Sep 22-Aug 23 CPI-U 12-mo avg of 301.3742. I keep getting $102, 000 when I round down.

[barneyfyfe]

We each pay Part D 100% on our own. The government has a lot of nerve adding a tax on that!

[slimdawgwoof]

Thank you for all you share. I want to be one of your clients soon!

[Erginartesia]

IRMAA and the SS-44 and Roth Conversions. I already know that the MAGI will have the Roth Conversion. But, what will SSA do if they reduce your Medicare B premium, and then your income is higher than you projected on the SS-44? Penalties? Back billing? What happens?

THEN there is the next year. Again the income will be higher because it is a salary year, but now you have Roth Conversions from last year. WHAT TO DO … WHAT TO DO…

Thank you for your wonderful videos!

[yi]

IF someone hits the IRMAA, usually the person's Social Security Benefits is taxed at max of 85% SSB. My question: Is the untaxed 15% of SSB including in the MAGI for IRMAA? Thanks!

[larryjones]

See The Finance Buff for continuously updated IRMAA brackets.

[davidstewart]

Terrific information to keep in mind while planning distributions and conversions. In all of the machinations, how do you keep in mind and stay away from AMT limits? I may want to do convert a huge amount from my TIRA to my ROTH, but would hate to find out I am now in an AMT situation as a MJ filer. Thanks.

[Greenlid]

What were the costs per income zone in 2022? Never said how much we are trying to avoid……

[everlastingarms]

Inflation indexed bonds principal works in a similar manner. (I used to be in IT for a brokerage that trade & cleared them.) This sounds way more complicated than it actually is, once one does an actual example.

[paulstein]

This is a very timely video because the IRMAA letters for 2023 were just sent out by SSA. Another issue is that the income tax brackets don’t align with the IRMAA brackets. So if you fill the first IRMAA bracket to ~$123, 000 (single filer), it will most likely push you into the 24% marginal income tax bracket. I have been doing Roth conversions and wondered if it makes sense to go into the 24% income tax bracket in order to fill the IRMAA bracket. In 2021, I filled the 22% bracket and stopped there, triggering first bracket of IRMAA.

[alexwyler]

Actually, the bureaucrats were told to create this system to preserve jobs like yours. NOT judging or criticizing. The tax system is complex so Turbo Tax, Jackson Hewitt and HandR Block can make tons of money and profit.

[wcottee]

If we are looking at IRMAA for 2024 do we compare our MAGI from 2022 with the threshold in 2024 or the threshold for 2022?