IRMAA Surcharges Explained: What Alabama's High-Income Retirees Need to Know

You worked hard, saved well, and built a comfortable retirement income. Now Medicare is charging you extra for it. The Income-Related Monthly Adjustment Amount (IRMAA) is a surcharge added to your Part B and Part D premiums when your income exceeds certain thresholds. And most people don’t see it coming until their first Social Security statement.

IRMAA affects a growing number of Alabama retirees, especially those with pension income, rental properties, investment gains, or retirement account distributions. Here’s what you need to know and what you can do about it.

2026 IRMAA Income Thresholds

Filing Status	Modified AGI	Monthly Part B Premium	Extra Monthly Cost
Single / MFS	$109,000 or less	$202.90	$0 (standard)
Single / MFS	$109,001 – $137,000	$284.10	+$81.20
Single / MFS	$137,001 – $171,000	$405.80	+$202.90
Single / MFS	$171,001 – $205,000	$527.50	+$324.60
Single / MFS	$205,001 – $500,000	$649.20	+$446.30
Single / MFS	Above $500,000	$689.90	+$487.00

These thresholds apply to your Modified Adjusted Gross Income from two years prior. So your 2026 IRMAA is based on your 2024 tax return.

Common IRMAA Triggers for Alabama Retirees

Large IRA/401(k) Distributions Required Minimum Distributions or large withdrawals from tax-deferred accounts can push you over IRMAA thresholds unexpectedly.

Home or Property Sale Capital gains from selling a home, rental property, or land in Alabama can spike your income for one year and trigger IRMAA surcharges.

Investment Income Dividends, capital gains distributions, and interest income all count toward your Modified AGI. A strong market year can push you into a higher IRMAA bracket.

Part-Time Work or Consulting Many Alabama retirees continue working part-time. That income stacks on top of Social Security and retirement distributions.

How to Reduce or Appeal IRMAA

Life-Changing Events: If your income dropped due to retirement, death of a spouse, divorce, loss of pension, or work reduction, you can file Form SSA-44 to request IRMAA reconsideration based on your current (lower) income rather than the two-year-old tax return.

Income Planning Strategies:

• Roth conversions spread over multiple years to avoid income spikes
• Timing large asset sales to minimize IRMAA impact
• Qualified Charitable Distributions (QCDs) from IRAs to reduce taxable income
• Working with a financial advisor to stay just below IRMAA thresholds

IRMAA and Your Medicare Supplement

IRMAA does not affect your Medicare Supplement premium, it only increases what you pay for Part B and Part D. But understanding IRMAA is part of comprehensive Medicare planning. If you’re paying $300+ extra per month in IRMAA surcharges, that changes the math on your overall healthcare budget.

This article is for educational purposes only and does not constitute tax or financial advice. IRMAA thresholds and amounts are subject to annual adjustment. Consult a tax professional and licensed insurance agent for guidance specific to your situation.