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How a Roth Conversion Can Affect Your Medicare Premiums (IRMAA)

Published Chris Urban, CFP®, RICP®, TPCP®Tax Planning

A Roth conversion adds the converted amount to your taxable income for that year. Medicare uses income from two years earlier to set your Part B and Part D premiums, so a conversion may raise what you pay for Medicare two years later if it pushes your income over an IRMAA threshold. Whether it makes sense depends on you.

This article is educational. It is not a recommendation to convert, and it is not tax advice for your situation. The Medicare figures below are from the sources linked at the end and are current as of October 30, 2026. Thresholds and premiums change every year, so check the sources for the latest numbers.

What IRMAA is and how a conversion counts as income

IRMAA stands for the Income-Related Monthly Adjustment Amount. It is a surcharge added to your Medicare Part B (medical) and Part D (prescription drug) premiums when your income is above certain levels. Most people with Medicare pay the standard Part B premium, which is $202.90 per month in 2026. Higher-income households pay more.

Social Security decides IRMAA using your modified adjusted gross income, or MAGI. For this purpose, MAGI is generally your adjusted gross income plus any tax-exempt interest.

When you convert money from a traditional IRA to a Roth IRA, the amount you convert is generally added to your taxable income for that tax year. That raises your adjusted gross income, and so it raises your MAGI. A conversion is also a one-time event, which means it can lift income for a single year well above your usual level. That is why the Medicare question comes up so often in Roth conversion planning.

The two-year lookback

IRMAA is not based on this year's income. It is based on a tax return from two years earlier.

For 2026 premiums, Social Security uses your 2024 tax return. If your 2024 return is not available, it may use 2023. Following the same pattern, income from a 2026 conversion would generally show up in your 2028 premiums, not in 2027.

This lag has two practical effects:

  • The cost arrives later. A conversion done this fall may not change your Medicare bill until two years from now, which is easy to overlook.
  • Timing around Medicare enrollment matters. If you are in your early 60s, income you report in the two years before you enroll can already affect your first Medicare premiums.

Income tiers and cliffs

IRMAA works in tiers. For 2026 premiums, the surcharge starts when your 2024 MAGI is above $109,000 for an individual return or above $218,000 for a joint return. Above that, there are several higher tiers, each with a larger surcharge on Part B and on Part D.

Two features of the tiers are worth understanding:

  • They behave like cliffs. Crossing a threshold by a small amount moves you into the next tier for that year's premiums. Income that sits just below a threshold and income that sits just above it can lead to noticeably different premiums.
  • They apply to each person. For a married couple, each spouse on Medicare pays the adjusted premium, so the added cost applies to both spouses.

As one example of the size of the step, the 2026 Part B premium in the first tier above the threshold is $284.10 per month, compared with the $202.90 standard premium. Part D adds its own surcharge on top of your plan premium. The full tier table is on the CMS fact sheet and the Social Security form SSA-44 (both as of October 30, 2026).

Life-changing events and how to ask for a review

If your income has dropped because of a qualifying life-changing event, you can ask Social Security to use more recent income instead of the older tax return. The events on the Social Security form are:

  • Marriage
  • Divorce or annulment
  • Death of your spouse
  • Work stoppage
  • Work reduction
  • Loss of income-producing property
  • Loss of pension income
  • Employer settlement payment

You make the request with Form SSA-44, "Medicare Income-Related Monthly Adjustment Amount - Life-Changing Event," along with evidence of both the event and your more recent income. You can also call Social Security at 1-800-772-1213 to schedule an interview.

A Roth conversion is not on that list. If a conversion raised your income in a year when you were also working full time, a later review is not something to count on. A review is designed for a real change in circumstances, such as retiring and no longer having a salary, not for a one-time income choice you made yourself.

What to look at before converting

There is no single right answer, and a conversion can have real benefits, such as tax-free growth in the Roth account and potentially lower required minimum distributions (RMDs) later. Those benefits come with limits: you owe income tax on the converted amount now, the added income may raise your Medicare premiums, and results vary with future tax law and your own circumstances. These are the questions I would look at together:

  • Tax bracket now compared with later. Would your marginal bracket in retirement, including the effect of RMDs and Social Security, be higher or lower than the bracket you would pay on the conversion today?
  • Where the tax payment comes from. Paying the tax from outside the IRA generally keeps more money in the Roth account, but it uses other savings. Paying it from the IRA itself reduces the amount that ends up in the Roth.
  • RMDs. Starting in your 70s, required withdrawals from pre-tax accounts add to income every year. Converting earlier may reduce the balance that RMDs are calculated on, but it may also raise income in the years you convert.
  • How Social Security is taxed. Extra income may cause more of your Social Security benefit to be taxable, which adds to the cost of a conversion in some years.
  • Multi-year planning. Rather than one large conversion, some people spread conversions over several years to stay under a particular bracket or IRMAA threshold. Looking at several years together is often more useful than looking at one year alone.

This kind of multi-year view is the focus of my income tax planning work. My income tax planning looks ahead at strategies across years, which fits the two-year lookback well. I do not prepare or file tax returns, and I am glad to work with your CPA so the numbers line up with your return.

Common questions about Roth conversions and Medicare premiums

Do Roth withdrawals count as income for IRMAA?

Qualified withdrawals of contributions and earnings from a Roth IRA are generally not included in adjusted gross income, so they generally do not count toward IRMAA. The conversion itself is different. The amount converted is counted as income in the year of the conversion. Your CPA can confirm how this applies to you.

Can I undo the IRMAA effect after I convert?

A conversion cannot be reversed for tax purposes. If your income later drops because of a qualifying life-changing event, you may be able to ask Social Security to use more recent income, but that depends on the event and your documentation.

When might a Roth conversion not be a good idea?

It depends on your situation. Some people find that the tax due now, the higher Medicare premiums, or the lack of cash outside the IRA to pay the tax make a conversion less attractive. Others find the opposite. That is why I look at your full picture before anyone decides.

Who to talk with

Because a conversion touches your taxes, your Medicare costs, and your retirement income at once, it helps to review it as a whole. For my clients, that starts with an Initial Engagement, which is described on my process page, and I answer common questions about how hourly planning works on the FAQs page.

If you want to talk through whether this applies to you, schedule a free 30-minute introductory call. There is no cost for anything before you sign an agreement.

Sources

This article is for general education and is not personalized investment, tax, or legal advice. Medicare rules, thresholds, and premiums change from year to year, and what applies to you depends on your individual circumstances.