Ever hear of IRMAA? It’s the Medicare income-related monthly adjustment amount. It’s a test, devised as a means test for recipients of the federal program. Some think it’s only fair; others call it a cliff-tax for the rich. Many, if not most, people don’t even know about it.
While it kicks-in at incomes over $91.000 for singles and $182,000 for marrieds and who are in Medicare Part B or Part D (or both), these surcharges can be significant.
Many people aren’t worried feeling they won’t be affected – and, maybe they’re right. The most common trigger event is the sale of a home. In that case, it’s likely their Medicare premium will go up for one year, then drop the following year. It’s important to remember, there’s a two-year ‘look-back’.
How to mitigate this? Sell at age 63! It won’t affect IRMMA.
There are other strategies you might consider, too. Tax planning should be ongoing – now and all the way through retirement. Congress won’t stop tinkering with the tax laws just because you’re retiring.
Register for my webinar, then grab some coffee and learn what you might be able to do to keep more of your hard-earned money from going to Washington.