How is IRMAA calculated for 2025 and which forms of income are counted?
Executive summary
IRMAA for 2025 is calculated from your Modified Adjusted Gross Income (MAGI) shown on your federal tax return from two years prior — i.e., your 2023 tax return — and is applied as a sliding‑scale surcharge added to Medicare Part B and Part D premiums (base Part B premium is $185 in 2025) [1] [2]. MAGI for IRMAA is your AGI plus certain tax‑exempt items (for example, tax‑exempt interest), and the first IRMAA threshold for 2025 is $106,000 (individual) / $212,000 (joint) [3] [4].
1. How SSA determines which year’s income is used — the two‑year “look‑back”
The Social Security Administration (SSA) uses the most recent federal tax return the IRS provides; for 2025 that is generally the return filed in 2024 for tax year 2023 — hence the common description that 2025 IRMAA is based on 2023 MAGI [1] [3]. The SSA’s public materials confirm this two‑year lag and note occasional exceptions when IRS data are only available from an earlier return [1].
2. What MAGI means for IRMAA — what income is counted
For IRMAA the SSA uses “modified adjusted gross income” (MAGI): take your adjusted gross income (AGI) from your tax return and add back certain tax‑free items such as tax‑exempt interest and some foreign income — the financial press and Medicare guides summarize MAGI that way [3] [5]. Multiple explainers list AGI as the starting point and specifically point to adding back tax‑exempt interest and similar items when computing IRMAA MAGI [3] [5].
3. Typical income items that move you into a higher bracket
Sources consistently note that wages, retirement distributions, capital gains, and Social Security benefits as reported on your tax return feed into AGI, and tax‑exempt interest and certain other exclusions are added back to form MAGI for IRMAA — meaning conventional retirement income, large investment gains, and tax‑exempt interest can push beneficiaries over the $106k/$212k thresholds for 2025 [6] [4]. Reporters and advisors emphasize that even income not currently taxed can count because it’s added back into MAGI for IRMAA [5] [4].
4. How much you may pay — sliding scale and Part B base premium
CMS and reporting note IRMAA is applied on a sliding scale across income brackets; the Part B standard monthly premium for 2025 is $185 and IRMAA surcharges are added on top of that amount for higher MAGI filers [2] [7]. Several consumer guides and calculators show the surcharge grows with each bracket and also affects Part D, where the IRMAA add‑on is handled separately [2] [8].
5. What to do if your income changed or the IRS data are wrong
SSA lets beneficiaries request a redetermination if a life‑changing event caused income to fall (divorce, death of spouse, retirement) or if SSA used incorrect tax information; Form SSA‑44 and SSA guidance describe the process and limited exceptions to the two‑year rule [9] [1]. Multiple advisory pieces urge planning (timing withdrawals, charitable strategies) to manage MAGI, but they also stress appeals are possible when circumstances changed [9] [10].
6. Disagreements, limitations and what the sources do not say
Sources agree on the two‑year look‑back, MAGI definition basics, and the 2025 thresholds; however, details about precisely which nonstandard items must be added back can vary in explanation between consumer sites and official SSA guidance [3] [1]. Available sources do not mention a definitive, exhaustive IRS‑SSA checklist here in the provided files listing every single income item treated as MAGI for IRMAA — beneficiaries should consult SSA/CMS or a tax professional for borderline cases (not found in current reporting).
7. Practical next steps for readers who may be affected
Check line items on your 2023 federal tax return (AGI) and add back tax‑exempt interest or other items noted by SSA to estimate your 2025 MAGI and possible IRMAA exposure; use SSA/Medicare calculators and the notices SSA sends if they decide to charge IRMAA [1] [8]. If your income dropped after the look‑back year, file for a redetermination (Form SSA‑44) and prepare documentation of the life‑changing event [9] [1].
Sources: CMS fact sheet and SSA guidance on premiums and MAGI [2] [1]; explanatory coverage and MAGI examples from Kiplinger, Medicare Family, and other consumer guides used above [3] [5].