There is an additional surcharge on monthly premiums for Medicare Parts B and D that retired taxpayers who had incomes above a certain amount have to pay that is known as Income-Related Monthly Adjustment Amounts (IRMAA). This column discusses how these taxpayers can minimize their IRMAAs using life insurance or annuity products. Taxpayers need to understand how the Social Security Administration applies these surcharges and the techniques that they can use to defer or reduce their taxable incomes. They need to have a good understanding of how to calculate their Modified Adjusted Gross Income (MAGI) to determine if they fall in the threshold that would make them liable for the surcharges. It is a good idea to speak with a professional estate planner who specializes in using life insurance or annuity products to minimize surcharges on Medicare premiums.
See Mark P. Cussen, How Advisors Can Minimize Medicare Surcharges with Life Insurance, Annuities, Investopedia, January 27, 2016.
Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.
