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While you are looking at Obamacare, something else just happened to your retirement.

With the nation lasered focused on President Obama’s Patient Protection and Affordable Care Act, referred to as the Affordable Care Act or “ACA” and what it may or may not do to health costs, other legislation, which no one is paying any attention too, has already been passed that will have a much bigger impact of every person in the country who reaches retirement.

Here are the 3 key pieces of legislation that will have a bigger impact on your life than the ACA, which you are not paying attention too:

1) The Medicare Modernization Act of 2003.

This piece of legislation not only created Medicare Advantage Plans as well as Medicare Part D prescription drug coverage, but what even some of our members in Congress seemed to miss is that it also paved the way for Medicare to be means tested through its Income Related Monthly Adjustment Amount (IRMAA).

  • Why you need to know about IRMAA:
    • Medicare’s IRMAA is a surcharge on the current year’s Medicare Part B and Part D premiums for those who earn too much income.
    • The income used to determine how your IRMAA surcharge is based off your modified adjusted gross income “MAGI”.
      • Some examples of MAGI are: Wages, Social Security, Pension Income, Rental Income, Capital Gains, Dividends, withdrawals from Traditional IRA’s, (401(k)’s and 403(b)’s.

IRMAA is, simply, another way Congress can tax your income without advertising it.

2) “Federal Appeals Court Case No. 11-5076” known as “Brian Hall verse Kathy Sebelius”.

The ruling in this court case upheld in the requirement set by the Federal Government that anyone who wants to receive their Social Security benefit must also accept Medicare Part A when eligible.

This paved the way for the Federal Government requiring that in order to receive any Social Security benefit a person must be at least 62 years of age and also be fully insured.

  • Why you need to know about Federal Appeals Case 11-5076:
    • By law if you want to collect your Social Security benefit you will have a mandatory cost too, which is your Medicare coverage.
      • Though, Medicare Part A is technically free of cost, there are other Parts of Medicare (Parts B and D) that are not free and have late enrollment penalties if you do not enroll into in time.
        • These other Parts of Medicare, which are not free just happen to also be tied to IRMAA.

By law, in order to receive your Social Security benefit you must subject yourself to the possibility of reaching IRMAA.

3) The 2014 Presidential Budget”.

Every Presidential Budget is the actual game plan on how the country will pay for itself in the upcoming year (please note that this has not yet passed through Congress as of yet, but it is an indicator on where we may be headed)

  • Why you need to know about President Obama’s Budget:
    • The Budget, unfortunately, calls for an increase in the IRMAA surcharges, and quite possibly a decrease in the income limits until “25% of all Medicare beneficiaries” are impacted by IRMAA.
    • The other bombshell, this Budget also, calls for a new 15% surcharge on low cost sharing Supplemental or Medigap plans.

Your only federally mandated cost you will have in retirement, your Medicare coverage, could become even more expensive than you could ever imagine.

Without any fanfare, press or mention by anyone in the media, the financial industry or even the government these 3 unknown pieces of legislation have effectively increased taxes on Traditional 401(k) assets, while placing handcuffs on people’s own Social Security benefits that they already paid for through taxes.

Good thing everyone is focused on Obamacare