IRMAA - a hidden time bomb?

I'd never heard of this, although I'm sure my accountant is aware. It seems like it should be better known.

Take a single man, 66 years old, collecting Social Security and on Medicare. $234 is witheld from his SS for Medicare. His Adjusted Income is $95,000 and he reports gambling winnings of $55,000 and losses of $58,000. The IRS considers his gambling a wash and he owes no more in tax. Two years go by and his Medicare deduction more than doubles. Medicare counts your winnings, but not your losses, so that $55,000 you "won" means your adjusted income was $150,000, not $95,000, and your medicare cost is doubled. Your 2027 Medicare deduction is based on your 2025 tax return. Next year, you'll only be able to deduct 90% of your losses and face a double whammy.
Income-Related Monthly Adjustment Amount. Is it a landmine or just more salesman's hype?

this sounds like the trap of AGI, adjusted gross income, being used to make certain determinations unfairly

In the US, if you are a gambler, everyone wants a piece of you, doesn't matter that you actually lose money doing it

yeah, i plan to sell my house at age 63 so i dont get hit by irmma at age 65 for medicare.
and yeah about agi.
seems like medicare views w2-g winnings like the irs calcs agi

Quote: 100xOdds

yeah, i plan to sell my house at age 63 so i dont get hit by irmma at age 65 for medicare.
and yeah about agi.
seems like medicare views w2-g winnings like the irs calcs agi
link to original post

You might be eligible for an exemption on the sale of your main domicile, but you would need to talk to a tax poro about that.

Quote: 100xOdds

yeah, i plan to sell my house at age 63 so i dont get hit by irmma at age 65 for medicare.
and yeah about agi.
seems like medicare views w2-g winnings like the irs calcs agi
link to original post

I read something, I don't know if it is true, but it said your medicare payment at 65 is based on your income at age 63. I don't know the details but I still hope to retire in two years at 62 so my income will be down when I am 63.

Quote: DRich

Quote: 100xOdds

yeah, i plan to sell my house at age 63 so i dont get hit by irmma at age 65 for medicare.
and yeah about agi.
seems like medicare views w2-g winnings like the irs calcs agi
link to original post

I read something, I don't know if it is true, but it said your medicare payment at 65 is based on your income at age 63. I don't know the details but I still hope to retire in two years at 62 so my income will be down when I am 63.
link to original post

Yes, 2027 premiums are based on 2025 income. If your individual income is under $95,000, you pay $234 per month, and your payments increase in brackets. That is the gist of it, but it wouldn't be Medicare if there weren't a few swerves to it. I don't know the brackets for married couples filing jointly.

I asked AI if I was paying the top rate:

Quote: AI

At $689.90 per month, you are already paying the absolute maximum tier for your Medicare Part B base premium under the Income-Related Monthly Adjustment Amount (IRMAA) for high-income earners.

Understanding Your Premium Tier Current Status: Your $689.90 rate reflects the highest bracketed surcharge for individuals with a modified adjusted gross income (MAGI) over $500,000 (or over $750,000 for married couples filing jointly) based on your tax return from two years prior. Absolute Maximum: Because you are at the top bracket, $689.90 is the highest standard Part B IRMAA tier charged.

I file as a pro gambler, so I do not report my W2-G income, just my net gambling income. For 2026, this will include some phantom income from the 90% cap on gambling deductions.