When you and/or your wife start to take RMD's, your income, including your MAGI will increase.
Your Medicare Part B premium is based upon your MAGI 2 years earlier. If you have more than x MAGI, you are charged and IRMAA subcharge, which cause your Medicare Part B to be 1.4x, 2x, 2.6x, 3.2x or 3.4x the base Part B.
The challenge with this system is that it is a CLIFF. If your MAGI is $1 over the limit, you can be responsible for paying >$1k in extra premiums. Most people would glady lose the $1 to save the >$1k.
Thus, the trick is understand if your MAGI (taxable SS, RMD's and other income) put you in an IRMAA bracket. If you are just barely in the IRMA bracket, you may find it is more cost effective to donate some of the RMD via the QCD method, to keep those donations from counting against your MAGI, and thus prevent you from going into a higher IRMAA bracket.
Here is an good summary of the brackets:https://thefinancebuff.com/medicare-irm ... ckets.html
Otherwise, just carry on. Be happy to pay the tax because the alternative is to not have the RMD's on which you are taxed.
Your Medicare Part B premium is based upon your MAGI 2 years earlier. If you have more than x MAGI, you are charged and IRMAA subcharge, which cause your Medicare Part B to be 1.4x, 2x, 2.6x, 3.2x or 3.4x the base Part B.
The challenge with this system is that it is a CLIFF. If your MAGI is $1 over the limit, you can be responsible for paying >$1k in extra premiums. Most people would glady lose the $1 to save the >$1k.
Thus, the trick is understand if your MAGI (taxable SS, RMD's and other income) put you in an IRMAA bracket. If you are just barely in the IRMA bracket, you may find it is more cost effective to donate some of the RMD via the QCD method, to keep those donations from counting against your MAGI, and thus prevent you from going into a higher IRMAA bracket.
Here is an good summary of the brackets:https://thefinancebuff.com/medicare-irm ... ckets.html
Otherwise, just carry on. Be happy to pay the tax because the alternative is to not have the RMD's on which you are taxed.
Statistics: Posted by Saving$ — Sat Oct 26, 2024 12:09 am