Published: November 13, 2026
When thinking about your finances after retirement, it’s important to include Medicare in your decisions.
One often overlooked aspect of how Medicare can impact your retirement budget is a Roth IRA conversion. Many people convert traditional retirement savings, like an IRA, into a Roth account as part of their tax strategy: Pay taxes on that money now in order to avoid taxes on future withdrawals. But when you convert funds to a Roth account, it raises your modified adjusted gross income (MAGI) for that year, which can dramatically increase your monthly Medicare premiums.
The good news is you have options. Talking with a financial advisor to understand how to time your Roth conversion can help you avoid a Medicare surcharge — and save you thousands in Part B and Part D premiums.
Roth conversions and IRMAA/Medicare: The 2-year lookback rule
The Income-Related Monthly Adjustment Amount (IRMAA) is a surcharge put in place for higher-income Medicare recipients. If your household income is above the IRMAA threshold in any year, you’ll pay more for your Part B and Part D premiums. Only about 7% of Part B recipients pay a higher premium due to IRMAA.
The IRMAA tiers, based on your modified adjusted gross income, look like this for 2026:
| Single | Married Filing Jointly | Part B Premium | Part D surcharge (added onto your premium) |
| $109,001 – $137,000 | $218,001 – $274,000 | $284.10 | $14.50 |
| $137,001- $171,000 | $274,001 – $342,000 | $405.80 | $37.50 |
| $171,001 – $205,000 | $342,001 – $410,000 | $527.50 | $60.40 |
| $205,001 – $499,999 | $410,001 – $749,999 | $649.20 | $83.30 |
| $500,000 + | $750,000 + | $689.90 | $91.00 |
Note: If you’re married and filing separately, there are only two tiers. Couples making more than $190,000 and less than $391,000 pay $649.20 for their Part B premiums and an additional $83.30 for Part D. Couples making $391,000 or more pay $689.90 for their Part B premiums and an additional $91.00 per month for Part D premiums.
How your IRMAA income is calculated
The way your income is tallied is through Medicare’s 2-year lookback. For instance, for 2027 the Centers for Medicare and Medicaid Services (CMS) will use your 2025 tax return to determine your income tier.
Medicare uses MAGI to determine your assets for IRMAA. Your MAGI includes your adjusted gross income along with tax-exempt interest income like municipal bonds.
Income that isn’t federally taxable is also included by CMS. This means your Social Security benefits, 401(k) withdrawals, and income from a pension all count toward your MAGI.
Note: 100% of your Roth IRA conversions are included in your MAGI income totals during the calendar year your conversion takes place.
Can I appeal Roth conversions for IRMAA?
Roth conversions can’t be appealed to reduce your IRMAA-related income tier. Form SSA-44, which is used to appeal an IRMAA surcharge, only applies to “life-changing events.” Even though a one-time withdrawal from your Roth IRA or the capital gain from selling a home might seem like they would be exempt from IRMAA calculations, they aren’t. The Social Security Administration considers these things voluntary financial decisions. The events that count for an appeal are:
- Marriage,
- Divorce,
- Death of a spouse,
- Work stoppage or reduction,
- Loss of income-producing property (due to an event like a natural disaster, not just a property sale),
- Loss of pension income,
- Employer settlement payment (after a closure or bankruptcy).
Note: If your MAGI is high for one tax year, the IRMAA surcharge will count toward the entire 12-month Medicare billing cycle that applies to that tax return.
Taking advantage of the pre-Medicare window
When you enroll in Medicare at 65 (which a vast majority of people do), the Social Security Administration looks back at your taxes from the year you turned 63. For this reason, you may consider converting your Roth IRA from the time you turn 59.5 to age 62, during your pre-Medicare income window. (If you convert before 59.5, you could incur an early distribution penalty).
If you convert your Roth IRA before age 63, you’ll pay the tax at an earlier age (which can be beneficial if you anticipate being in a higher tax bracket in the future). But, if you’re a high-income earner, you’ll enter Medicare with a lower MAGI footprint, which can save thousands in your first year on Medicare for a married couple.
Note: Qualified Roth withdrawals are different than conversions. A Roth withdrawal that counts as “qualified” means you’ve had the account for at least five years, you are 59.5 or older, and you are withdrawing money directly from the Roth account. This keeps the money tax-free. A conversion, on the other hand, happens when you move money from a tax-deferred account – like a 401(k) – to a Roth IRA. When it’s converted, that amount is included in your taxable income for the year.
Step-by-step instructions for Roth conversion
If you are a high-income earner, you want to ensure you are making the best financial and wellness decisions when it’s time to enroll in Medicare. It’s a good idea to talk with your accountant or financial advisor by the age of 60 to discuss your options. Here are some things to consider when it comes to Medicare, IRMAA, and Roth IRA conversions.
- Calculate your distance from the nearest IRMAA threshold before executing an end-of-year conversion.
- Map out conversion tranches over three to five years rather than converting it in a single lump sum to stay below IRMAA thresholds.
- Coordinate Medicare enrollment dates with your CPA to model the 2-year lookback impact.
Include Medicare in your retirement portfolio
Protecting assets and income is an important part of retirement, and you can’t plan too early. Getting hit with an IRMAA letter when you aren’t expecting it can cost you thousands of dollars in Medicare premiums in a year’s time. If you think you might be close to the IRMAA threshold or want to find out your risk, you can calculate your IRMAA with our calculator.
Disclaimer: This article is published by United Medicare Advisors for educational and informational purposes only and does not constitute financial, investment, legal, or tax advice. United Medicare Advisors is an independent insurance agency; its licensed agents do not provide tax preparation, estate planning, or certified financial advisory services. Executing a Roth conversion can create taxable income that triggers or increases Medicare Part B and Part D Income-Related Monthly Adjustment Amounts (IRMAA). Because tax regulations and Medicare premium thresholds are subject to change and depend heavily on individual circumstances, you should always consult a qualified Certified Financial Planner (CFP®), Certified Public Accountant (CPA), or licensed retirement planning professional before executing any retirement account conversions or major financial decisions.
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Topic: Roth Conversions & Medicare IRMAA: What Retirees Should Know
Target audience: The Wealth Planner (Ages 60–70): Affluent retirees or near-retirees with substantial tax-deferred retirement accounts seeking to balance tax minimization with healthcare surcharges.
Goal: Educate readers on how Roth conversions impact Medicare Modified Adjusted Gross Income (MAGI), dispel the myth that IRMAA surcharges from conversions can be appealed, and showcase strategic timing (the “Pre-Medicare Window”) to protect long-term healthcare costs.
