IRMAA — Income-Related Monthly Adjustment Amount
What it actually means
IRMAA is the Medicare Part B and Part D premium surcharge that high-income retirees pay above the base premium. Income brackets (based on MAGI from 2 years prior) trigger surcharges from $0 to $400+/mo per person. The cliff structure means crossing into the next bracket by $1 can cost $1,000+/year per person — making bracket management critical for retirees, especially when planning Roth conversions, IRA distributions, or large capital gains in years 63-73 (which affect Medicare premiums starting at 65).
IRMAA brackets are notoriously cliff-structured (not phased). A retiree at $206K MAGI pays the second bracket; at $206,001 MAGI they pay the third bracket — a real $1,000+/yr per-person jump for $1 of additional income. Most retirees don't learn about IRMAA until their first surcharge bill arrives. HELM's Roth-conversion-ladder optimizer and capital-gains scenario builder both flag IRMAA bracket boundaries before triggering them.