Medicare IRMAA lowest bracket threshold amount for 2021?

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  • #5006
    luke_airig
    Participant

    I am doing year-end tax planning for my 2019 tax year and
    I want to convert TIRA funds to my Roth IRA while keeping my federal 2019
    modified adjusted gross income below the lowest IRMAA threshold that will
    apply to Medicare year 2021.

    I will be filing an individual tax return.

    This link to the Medicare.gov website
    https://www.medicare.gov/your-medicare-costs/part-b-costs
    indicates the lowest bracket threshold amount for Medicare year 2020 for individual filing is $87,000.

    My understanding is that for future years beyond Medicare year 2020 this threshold amount will be inflation adjusted for each year. Since the inflation adjustment for Medicare year 2021 is unknown at this time, can I rely on the Medicare year 2021 threshold amount being a minimum of $87,000?

    TIA

    Luke

    #5020
    Kaye Thomas
    Moderator

    Looking at the Act, there is no clear indication that it can’t go down. The inflation adjustment is based on the amount by which the index exceeds the index for the year ending August 2018. If we were to have a year of negative inflation, the 2021 index figure could exceed the 2018 figure by a smaller amount than the 2020 figure. To the best of my knowledge, there is little if any expectation of negative inflation (or deflation), and the Federal Reserve would act vigorously to counter that possibility if it appeared likely, but as far as I can tell there is at least a remote chance the IRMAA figure could decline.

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