How is MAGi Calculated for IRMAA?

[Another Reader]

If I read the brochure from Medicare (https://www.ssa.gov/pubs/EN-05-10536.pdf) correctly, MAGI is calculated for IRMAA by taking your AGI from two years prior to the billing year and adding back tax exempt interest. Nothing else, just the tax exempt interest.

MAGI calculated for other purposes adds back a lot more. Is Magi for IRMAA as described in the brochure accurate? Or is that a simplification and there are other things that are added back?

Trying to figure out how much IRMAA I will have to pay, and because the brackets are so tight, this makes a substantial difference.

 

[Dtail]

I know for sure one does not add back the non taxable portion of SS benefits, which is added back for ACA MAGI purposes.
I think certain interest income from US Savings Bonds is added back for Medicare if used to pay for higher education.

 

[audreyh1]

If I read the brochure from Medicare (https://www.ssa.gov/pubs/EN-05-10536.pdf) correctly, MAGI is calculated for IRMAA by taking your AGI from two years prior to the billing year and adding back tax exempt interest. Nothing else, just the tax exempt interest.

MAGI calculated for other purposes adds back a lot more. Is Magi for IRMAA as described in the brochure accurate? Or is that a simplification and there are other things that are added back?

Trying to figure out how much IRMAA I will have to pay, and because the brackets are so tight, this makes a substantial difference.

That is my understanding.

 

[Another Reader]

That is my understanding.

That's what Kitces says in this article on the new compressed brackets as well.

https://www.kitces.com/blog/irmaa-m...-premium-surcharges-new-2018-magi-thresholds/

 

[kaneohe]

Interesting question.......until a few wks ago, I would have agreed w/ OP
(and actually I still do) mainly based on the same Medicare brochure.....the horses's mouth.........and other miscellaneous links,including the Kitces reference also .

Very recently I saw on bogleheads.org a similar thread where one poster had given a link to another document purporting to give the MAGI definition of a number of medically related things......including among others, Medicare & Obamacare. The name of the reference document was impressive but the fact that all 4 or so MAGIs were so similar made me reluctant to believe it.

The possible added components were tax-exempt interest, non-taxable part of SS, FEIE, Savings Bond excluded income and ??

Unfortunately I have not been able to locate that thread yet even w/ external google searching. Perhaps someone here can locate it. Makes me a little more sympathetic to folks who sucumb to fake news..........

 

[kaneohe]

Found it! https://fas.org/sgp/crs/misc/R43861.pdf

Perhaps the other factors for IRMAA don't affect many folks so the simplified version works most of the time..........assuming the chart here is correct......still have my doubts.

https://www.bogleheads.org/forum/viewtopic.php?f=2&t=205295

http://www.loc.gov/crsinfo/

 

[Crabby Mike]

There are MAGI calculations for many things in the tax code and elsewhere (like Medicare), and they are virtually all different. Don't let the common acronym mislead you.

Medicare IRMAA MAGI is indeed just AGI plus tax-exempt interest income, per SSA.gov.

 

[nwsteve]

There are MAGI calculations for many things in the tax code and elsewhere (like Medicare), and they are virtually all different. Don't let the common acronym mislead you.

Medicare IRMAA MAGI is indeed just AGI plus tax-exempt interest income, per SSA.gov.

+1. We were borderline breaking the second threshold last year and CPA did "double-duty" to verify the definition as above.