Medicare can be overwhelming. Sorting out the coverage premiums and out-of-pocket costs can be confusing, let alone understanding the different penalties that can be assessed. In today’s blog post we’ll take a look at the IRMAA Penalty and simplify it so that it’s easier to understand.
The Income-Related Monthly Adjustment Amount (IRMAA) penalty applies to individuals whose modified adjusted gross income is greater than the specified threshold amounts. This means you will pay a greater amount on the monthly Medicare Part D prescription drug plan premiums and Part B coverage premiums.
The threshold amounts in 2017 are as follows:
- $85,000 for a beneficiary filing an individual income tax return or married and filing a separate return
- $170,000 for a beneficiary filing a joint tax return
The Part D IRMAA penalty amount is paid directly to the federal government, not to your Part D plan. If your most recent tax return indicates your modified adjusted gross income is indeed greater than the threshold amounts, the Social Security Administration will mail you a letter indicating the extra amount that you will owe. Be sure to pay your IRMAA, or you will risk disenrollment from your Medicare Part D plan.
If you have any questions or would like more information, contact one of our Medicare advisors today at (614) 799-1403.