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How can Business Executives strategically manage IRMAA in Retirement? 

For Business Executive and other High-Income Professionals, Medicare Planning is not just about choosing the appropriate coverage, it is about managing Income Related Monthly Adjustment Amount (IRMAA).  Business Executives and their spouses can unknowingly overpay thousands of dollars per year in Medicare Part B and Part D Premiums without proper strategic planning. 

🔍 Why does IRMAA matter for retiring Business Executives?

• IRMAA is a Surcharge (“Stealth Tax”) added to Medicare Part B and Part D premiums for higher income earners.
• It is based on your Modified Adjusted Gross Income (MAGI).
• Business  Executives are frequently impacted due to peak compensation, bonus payouts, equity events including RSUs vesting or exercising NQSOs before retirement, and Deferred Compensation Plan payouts after retirement. 

⏳ What is the IRMAA Two-Year Lookback Tax Trap?

• Medicare utilizes your Prior 2 Years of Tax Returns to calculate your Medicare Part B and Part D Premiums.
• Recently retired Business Executives may overpay for Medicare Premiums even though their Earned Income drops significantly after retirement.
• Common IRMAA triggers may include:
  • Final-year salary and Large Performance Bonus payouts
  • RSU Vesting, NQSO Exercises, Large Capital Gains
  • Large 401(k) or IRA Distributions
  • Deferred Compensation Plan payments

📝 How can Business Executives appeal IRMAA after a Life-Changing Event?

• File Form SSA-44 https://www.ssa.gov/forms/ssa-44.pdf to appeal IRMAA
• IRMAA Types of Life-Changing Events may include:
  • Work Stoppage
  • Work Reduction
  • Death of Your Spouse
  • Marriage / Divorce
  • Loss of Income-Producing Property
  • Loss of Pension Income

🧠 How can you Strategically Plan to reduce the future impact of IRMAA?

• Tax-Efficient Asset Location to control timing of Taxable Income
• Potentially modify existing Deferred Compensation Plan payouts
• Proactive  Roth Conversions to limit future RMD-driven income
• Proactive Multi-Year Tax Planning Strategies to “smooth” income

✅ Bottom Line

• IRMAA is a meaningful and manageable retirement expense, and the impact of IRMAA can be strategically managed with proactive planning and implementing Multi-Year Tax Planning strategies. 

📅 Ready to Reduce your Medicare IRMAA Surcharges?

Schedule a Free Executive Consultation today.

calendly.com/lifetimefinancialplanners

Ideal for Business Executives near retirement who want to reduce or eliminate surprise IRMAA Surcharges.