Dear Rusty: I am confused by an article in my local newspaper which said that “MAGI” (modified adjusted gross income), on which my Medicare Part B premium is based, is my Adjusted Gross Income, plus any non-taxable interest, plus 50% of the social security I received. The part that is confusing is the 50% part. When I look at my tax return my Adjusted Gross Income includes the taxable portion of my Social Security benefit which, in my case, is 85% of my total benefits. Why must 50% of benefits be added to my AGI if it is already included in my total AGI? Signed: Confused
Dear Confused: The article you refer to was misleading for stating that the Modified Adjusted Gross Income (MAGI) used to determine your Medicare premiums includes your normal Adjusted Gross Income (AGI) from your income tax return, plus any non-taxable interest you may have had, plus 50% of the SS benefits you received during the tax year. What the article should have said was that the MAGI which determines your Income-Related Monthly Adjustment Amount (IRMAA) to your Medicare premiums consists of your normal AGI from your tax return (which includes the taxable portion of your Social Security benefits), plus any non-taxable interest you may have had.
For additional clarity, the Income-Related Monthly Adjustment Amount (IRMAA) is a supplemental amount added to the standard Medicare premium for those with higher incomes. The thresholds at which the IRMAA supplements apply depend on your IRS filing status, and your MAGI determines the amount of supplement which will be added to the standard Medicare premium. Single filers with MAGI over $103,000, or married filers with MAGI over $206,000 will see an IRMAA supplement added to their Medicare premium. Those whose MAGI is under the first IRMAA threshold pay the standard Medicare premium, but those whose MAGI exceeds the first IRMAA threshold above will pay more. How much more depends on how much their MAGI exceeds the first IRMAA threshold by. The IRMAA supplement (the additional premium amount) could be anywhere from $69.90 to $419.30 per month for Medicare Part B (coverage for outpatient services), or an additional $12.90 to $81.00 per month to the Medicare Part D (prescription drug plan) premium - again dependent on how much over the initial MAGI threshold the person is for their IRS filing status. You can see the MAGI levels and corresponding IRMAA supplements at this Medicare website: www.cms.gov/newsroom/fact-sheets/2024-medicare-parts-b-premiums-and-deductibles
IRMAA and MAGI can be confusing. If you have questions about your Medicare premiums, help is available at SSadvisor@amacfoundation.org, or at 1-888-750-2622.
Russell Gloor is an Association of Mature American Citizens certified social security advisor. To submit a question, visit amacfoundation.org/programs/social-security-advisory or email ssadvisor@amacfoundation.org.
