Medicare Part D

How your 2024 tax return can raise your 2026 Medicare Part B and Part D bill

MEDINA, Ohio — If you are reviewing Medicare coverage this fall for the 2027 plan year, there is one number that often catches people off guard: the income reported on your tax return from two years ago. That figure is what Medicare uses to decide whether you pay the standard Part B and Part D premiums — or a surcharge on top of them. For 2026, those surcharges kick in once a single filer's income tops $109,000.

The surcharge is called the Income-Related Monthly Adjustment Amount, or IRMAA. It is not a penalty, and it is not tied to your plan choice. It is an add-on billed by Medicare based on what the IRS reported about you.

What is IRMAA and who pays it in 2026?

IRMAA is an extra amount added to your Medicare Part B and Part D premiums when your income is above a set level. For 2026, a single filer with income above $109,000 — or a married couple filing jointly above roughly double that — will owe the surcharge. Most people on Medicare do not pay it, because most people fall below the threshold.

Medicare uses your modified adjusted gross income (MAGI) from your most recent tax return on file, which in 2026 is typically your 2024 return. The surcharge grows in tiers: the higher your income, the larger the add-on.

How does income affect Part B costs in 2026?

If your income is at or below $109,000 as a single filer in 2026, you pay the standard Part B premium. Above that line, Social Security adds the IRMAA surcharge directly to your monthly Part B bill. The exact dollar amount depends on which income tier you fall into, and it is published each year by CMS on medicare.gov.

The Part B surcharge is usually deducted automatically from your Social Security check. If you are not yet collecting Social Security, Medicare bills you directly.

How does income affect Part D costs in 2026?

Part D works the same way, but with one twist: the IRMAA surcharge is separate from your drug plan's premium. You pay your plan whatever premium it charges, and you pay Medicare the IRMAA amount on top. That extra bill often comes as a surprise to people in their first year of higher-income Medicare.

For 2026, Part D also comes with a $2,100 annual out-of-pocket cap on covered drugs and a maximum deductible of $615. Those limits apply to everyone in a Part D plan, regardless of income. The coverage gap, often called the donut hole, was eliminated starting in 2025, so Part D now has three phases instead of four.

What if my income has gone down since 2024?

You can appeal. Social Security allows a reconsideration if you have had a qualifying "life-changing event" — retirement, the death of a spouse, divorce, loss of a pension, or a few others. You file Form SSA-44 and attach proof of the change.

This matters for people who recently stopped working. The tax year Medicare looks at may show full-time wages, even though your current income is much lower. A successful SSA-44 request can remove or reduce the surcharge for the current year.

How does this fit into Open Enrollment for 2027?

Medicare's Annual Enrollment Period runs Oct. 15 through Dec. 7 each year, and it is when you can change your Part D plan or your Medicare Advantage plan for the following year. Medina is in Medina County, where plan availability is set at the county level by CMS.

IRMAA itself is not something you shop for or change during enrollment — it is tied to your tax return, not your plan. But if you are looking at a Part D plan or an Advantage plan with drug coverage, remember that any IRMAA Part D surcharge you owe will be billed separately by Medicare, no matter which plan you choose.

If you miss the fall window, Medicare Advantage has a second window from Jan. 1 through March 31 for people already in an Advantage plan to switch once.