So you are in IRMAA and now doing as much research as possible on the subject as it has been a mystery up until this point and the question is what will IRMAA 2025 and beyond look like?
Before we dive into IRMAA 2025 let’s just recap a few facts about IRMAA first.
Some facts about IRMAA:
- IRMAA is short for Medicare’s Income Related Monthly Adjustment Amount (IRMAA).
- It is a surcharge on top of the current year’s Medicare Part B and Part premiums for those who earn too much money.
- Created in 2003 with the passing of the Medicare Modernization from Congress.
- Roughly 15% of all eligible Medicare beneficiaries are in IRMAA today.
- The federal government will collect $20.6 billion in 2023 from Medicare beneficiaries in IRMAA.
- By 2031 roughly 25.50% of eligible Medicare beneficiaries will be in IRMAA.
- The federal government will collect $63.8 billion from Medicare beneficiaries in IRMAA.
What will the costs of IRMAA 2025 be?
When it comes to accurately predicating the future, especially when the predication is about a tax that the federal government needs to collect, it usually is not that difficult to nail.
Again, IRMAA is just another tax on income that ends up being revenue for the federal government so when it comes to the future of IRMAA the federal government is already counting it.
According to recent Medicare Board of Trustees Reports in 2025 the IRMAA surcharges will be:
| Part B | Part D | |
| No IRMAA | $185.00 | Premium |
| 1st IRMAA Threshold | $259.00 | Premium + $13.70 |
| 2nd IRMAA Threshold | $369.90 | Premium + $35.30 |
| 3rd IRMAA Threshold | $480.80 | Premium + $57.00 |
| 4th IRMAA Threshold | $591.90 | Premium + $78.60 |
| 5th IRMAA Threshold | $628.90 | Premium + $85.80 |
How many people will reach IRMAA 2025?
By 2025 the federal government is projecting that 62.5 million people will be in Medicare and receiving coverage.
Under federal law no person in Medicare who is receiving financial assistance in any form in terms of affordability of their premiums can be in IRMAA.
Historically, according to the Trustees of Medicare, roughly 27% of all Medicare beneficiaries have been receiving some financial help when it comes to affording their premiums.
Out of roughly 46.8 million Medicare beneficiaries who will be eligible for IRMAA the Trustees are stating that 8.3 million or 17.71% of the total will be in IRMAA.
By 2031 the Trustees are projecting that the number of people in IRMAA will be roughly 25.% of all eligible Medicare beneficiaries or 15.5 million people.
Depending on what your income is currently, there is a good chance that IRMAA 2025 is in your future as Medicare needs to double the number to stay solvent.
What is income for IRMAA 2025?
IRMAA 2025 is all about looking at your income and in retirement there are 2 different kinds of it as there are:
- Income that the government sees for IRMAA.
- Income that the government does NOT see for IRMAA.
Social Security.gov defines income for IRMAA any your adjustable gross income (AGI) plus tax-exempt intertest you may have.
To figure out your amount of IRMAA income simply look at lines 2a and 11 of your 2022 IRS form 1040.
Some examples of income that the government counts towards IRMAA are:
| Wages | Traditional IRA Distributions |
| Taxable Social Security benefits | Traditional 401(k) Distributions |
| Interest | Traditional 403(b) Distributions |
| Capital Gains | Qualified Annuity Income |
| Dividends | Rental & Pension Income |
For a comprehensive list of income that counts towards IRMAA please click here.
Some examples of income that government does NOT count towards are:
| Roth Accounts |
| Life Insurance |
| Portion of Non-Qualified Annuity Income |
| Health Savings Accounts |
| 401(h) Plans |
Conclusion of IRMAA 2025
Unfortunately, with Medicare reportedly going insolvent and the federal government running out of money IRMAA is NOT going to go away.
The surcharges or amount of taxes that you must pay for reaching IRMAA are only going to increase each year.
The only way to completely avoid IRMAA is to ensure that your income is not visible to the federal government. This means utilize Roth Accounts, Life Insurance and Non-Qualified Annuities whenever possible.
For more information on IRMAA and how to plan (avoid) around it please contact an IRMAA Certified Professional in your area.
