Basics
MAGI for IRMAA: what counts and how to calculate it
For IRMAA, modified adjusted gross income is your adjusted gross income from line 11 of Form 1040 plus tax-exempt interest from line 2a (and, rarely, certain foreign income you excluded). Roth IRA withdrawals and qualified charitable distributions do not count; Roth conversions, capital gains and IRA withdrawals do.
The formula
Many tax rules use their own version of "modified" AGI, which is why the term causes confusion. The IRMAA version is one of the simplest. Social Security takes three numbers from the tax return the IRS sends it:
- Adjusted gross income, line 11 of Form 1040.
- Tax-exempt interest, line 2a, mostly from municipal bonds and municipal bond funds.
- Excluded foreign earned income and certain income from U.S. territories, which applies to very few retirees.
Add them together and you have MAGI for IRMAA. Social Security compares that figure, from your return two years earlier, with the limits for your filing status.
A line-by-line example
Carol is single and 68. Here is how her 2024 return produces the MAGI that sets her 2026 premiums:
| Item | Where it appears | Amount |
|---|---|---|
| Pension | Line 5b | $40,000 |
| Taxable Social Security (85% of $33,000) | Line 6b | $28,050 |
| Traditional IRA withdrawals | Line 4b | $20,000 |
| Interest and dividends | Lines 2b and 3b | $6,450 |
| Capital gains | Line 7 | $4,000 |
| Adjusted gross income | Line 11 | $98,500 |
| Tax-exempt municipal bond interest | Line 2a | $12,000 |
| MAGI for IRMAA | Line 11 + line 2a | $110,500 |
Her AGI is comfortably below the $109,000 limit, but the municipal bond interest is added back, which takes her to $110,500. That is $1,500 over the first cliff. For 2026 she pays tier one: $3,583.20 a year for Part B and the Part D surcharge, instead of $2,434.80 on the standard premium, or $1,148.40 more. If her municipal bond fund had paid $1,600 less interest, or if she had moved $1,600 of her IRA withdrawal into a qualified charitable distribution, she would have stayed on the standard premium.
The lesson is that tax-free income is not IRMAA-free income. If you hold municipal bonds, look at line 2a when you estimate your headroom.
What counts toward MAGI
| Income | Counts for IRMAA? |
|---|---|
| Wages and self-employment income | Yes |
| Pensions and annuity payments (taxable part) | Yes |
| Traditional IRA, 401(k) and 403(b) withdrawals, including RMDs | Yes |
| Roth conversions | Yes, the full converted amount |
| Taxable part of Social Security (up to 85%) | Yes |
| Interest, dividends and capital gain distributions | Yes |
| Capital gains from selling investments or property | Yes, after any home-sale exclusion |
| Tax-exempt municipal bond interest | Yes, added back |
| Rental income (net) | Yes |
| Qualified Roth IRA withdrawals | No |
| Qualified charitable distributions from an IRA | No, if sent directly to the charity |
| Health savings account withdrawals for medical costs | No |
| Return of your own basis, loans, gifts and inheritances received | No |
Deductions that lower MAGI, and ones that do not
Because MAGI starts from adjusted gross income, only "above-the-line" adjustments reduce it. Contributions to a traditional IRA or a health savings account while you are still eligible, deductible self-employment costs, and capital losses (up to $3,000 a year against other income) all lower AGI. The standard deduction and itemized deductions, such as mortgage interest, medical expenses and charitable gifts by check, are taken after AGI, so they do nothing for IRMAA. This is why a qualified charitable distribution, which keeps the money out of AGI entirely, beats writing a check to the same charity for IRMAA purposes.
Married couples and MAGI
On a joint return, Social Security uses the couple's combined MAGI and compares it with the joint limits, which start at $218,000 for 2026. It does not matter which spouse earned the income: a large IRA withdrawal by one spouse raises the premium for both if both are on Medicare. If only one spouse is enrolled, only that spouse pays IRMAA, but the test still uses the combined joint figure. Couples who file separately are judged on their own income, against a much harsher table, which is why separate filing rarely helps with IRMAA.
Finding your number quickly
- Open your federal return for the year that matters: two years before the premium year.
- Write down line 11 (AGI) and line 2a (tax-exempt interest).
- Add them. If you excluded foreign income, add that too.
- Enter the total in the IRMAA calculator with your filing status from that return.
For a year that has not ended yet, estimate each line from your statements and add a cushion for December fund distributions, which often arrive late and can be large.
Know your MAGI? See your tier and your room before the next cliff.
Open the IRMAA calculatorFrequently asked questions
Is MAGI for IRMAA the same as MAGI for Roth IRA contributions?
Does my Social Security benefit count?
Do capital losses help?
Does a required minimum distribution count if I give it to charity?
Sources
- Social Security POMS HI 01101.020: modified adjusted gross income for IRMAA
- IRS: About Form 1040
- IRS Publication 590-B: distributions from IRAs