MAGI for IRMAA: What Income Counts

IRMAA uses its own definition of modified adjusted gross income. Per SSA regulation 20 CFR 418.1010, MAGI is your adjusted gross income plus tax-exempt interest income, plus certain income excluded from AGI (such as excluded foreign earned income and certain income from U.S. territories).

Commonly included (through AGI)

• Wages and self-employment income
• Traditional IRA / 401(k) distributions, including required minimum distributions
• Roth conversions (the converted amount)
• Capital gains (including from selling a home above the exclusion), dividends, taxable interest
• The taxable portion of Social Security benefits
• Pension and annuity income, rental income

Commonly not included

• Qualified Roth IRA distributions
• Qualified HSA withdrawals for medical expenses
• Qualified charitable distributions (QCDs) from an IRA, which are excluded from income
• The non-taxable portion of Social Security

Which year? IRMAA usually looks at the tax return from two years before the premium year — see the two-year lookback. If income dropped because of a qualifying life event, you may appeal with Form SSA-44.

This is a general description; confirm your own situation with a tax professional.