Turning 63 in 2026? Your
IRMAA Window Is Closing

Why 63 Is the Critical Age

If you were born in 1963 and are turning 63 this year, you will turn 65 in 2028. That is the year most people first enroll in Medicare. And here is what many people approaching that milestone do not realize: the Social Security Administration will use your 2026 tax return to determine whether you owe an IRMAA surcharge on your very first Medicare premiums.

That makes 2026 the last full calendar year where your income decisions are entirely within your control before enrollment. Every dollar of income recorded this year, from salary and capital gains to Roth conversions and rental income, feeds directly into the calculation SSA will use to set your 2028 Part B and Part D premiums.

The strategies that work must be in place two years before you enroll. For someone turning 63 right now, that two-year clock is already running.

The Two-Year Lookback Math

IRMAA operates on a two-year lookback. SSA does not use your current income to set your Medicare premiums. Instead, it uses your Modified Adjusted Gross Income (MAGI) from the tax return filed two years prior. Here is how the timeline works for someone enrolling in Medicare in 2028:

• 2026: You earn income throughout the calendar year
• Early 2027: You file your 2026 federal tax return with the IRS
• 2028: SSA pulls your 2026 MAGI from IRS records and uses it to determine your Medicare Part B and Part D premiums for the year

There is no grace period and no adjustment for the fact that your income may be lower by the time you actually enroll. If your 2026 MAGI crosses a threshold, even by 1 cent, SSA assigns the corresponding surcharge for 2028.

What Counts as Income This Year

IRMAA is based on MAGI, which includes your Adjusted Gross Income plus certain add-backs. The most common income sources that count toward the calculation include:

• Salary, wages, and self-employment income
• Capital gains from investments, real estate, or business sales
• Roth conversion amounts (the converted amount counts as taxable income)
• Traditional IRA and 401(k) distributions
• Rental income and business income
• Pension and annuity payments
• Municipal bond interest, which is excluded from regular AGI but added back into MAGI

That last item catches many people off guard. Municipal bonds are often held specifically for their tax advantages, yet the interest still counts toward the IRMAA calculation. For a complete breakdown of what counts as MAGI and what does not, see our full guide.

Income Events to Plan Around in 2026

Certain financial events create large, one-time spikes in MAGI. If any of these are on your horizon this year, the impact on your 2028 Medicare premiums may be significant:

• Roth conversions: Converting a traditional IRA to a Roth adds the full converted amount to your 2026 MAGI, even though the goal is to reduce future taxable income
• Property sales: Selling a home, rental property, or land produces capital gains that flow into MAGI. For a primary residence, gains above $250,000 (single) or $500,000 (joint) are taxable
• Business sales: Selling a business or partnership interest often generates a concentrated income event in a single tax year
• Stock option exercises: Exercising incentive stock options or selling vested restricted stock units can push MAGI well above normal levels
• Retirement timing and severance: If you retire mid-year with a severance package, that income stacks on top of whatever you earned before leaving, potentially pushing you into a higher bracket

None of these events are inherently problematic. The risk comes from acting without awareness of how IRMAA works, then discovering the surcharge two years later when it is too late to change anything.

The Roth Conversion Sweet Spot: Ages 60 to 63

The optimal window for Roth conversions, when viewed through the lens of IRMAA planning, is often considered to be ages 60 through 63. During these years, many people have retired or reduced their income, creating room to convert at lower tax rates. And because they have not yet enrolled in Medicare, the conversion amount hits their MAGI without triggering an immediate IRMAA surcharge.

For someone turning 63 in 2026, this is the final year in that window. Converting now means future qualified Roth distributions will be completely excluded from MAGI, potentially keeping premiums at the standard rate for years to come. However, the conversion amount itself will appear on the 2026 tax return, so it must be modeled carefully against the current bracket thresholds to avoid inadvertently pushing MAGI into a higher tier.

Depending on your situation, a partial conversion, spread across this year and the remaining months of the window, may help manage the MAGI impact while still repositioning assets for the future.

What If Your Birthday Is Later in 2026?

Whether you turned 63 in January or will turn 63 in December, the tax year that matters is the same: calendar year 2026. Your birthday does not change the lookback math. SSA will still use the full 2026 tax return to set 2028 premiums.

That means you still have months to model your projected income, evaluate strategies, and make adjustments before the tax year closes on December 31. The key is starting now, while there is still time to act on what the numbers reveal, rather than discovering the impact after the year is over.

Steps to Consider Now

• Model your projected 2026 income. Include all sources: salary, investment income, expected capital gains, any planned conversions or distributions. Compare the total to the 2026 IRMAA bracket thresholds.
• Work with a tax professional. A CPA or tax advisor who understands the two-year lookback can help identify opportunities to manage MAGI before December 31.
• Understand the thresholds. For joint filers, the first surcharge tier begins at $218,000.01. For single filers, it begins at $109,000.01. Knowing exactly where you stand relative to those lines is the first step.
• Evaluate available strategies. Depending on your situation, tactics like timing income events, managing conversion amounts, or maximizing pre-tax contributions may help. Our strategies overview outlines the most commonly considered approaches.
• Consider the long-term picture. IRMAA is reassessed annually. Positioning income this year may reduce surcharges not just for 2028 but for multiple years of enrollment.

It is also worth noting that IRMAA surcharges may qualify as deductible medical expenses on Schedule A if your total medical costs exceed 7.5% of your adjusted gross income. This does not eliminate the surcharge, but it may soften the impact at tax time. Consult a tax professional to determine if this applies to your situation.

Sources

• Centers for Medicare & Medicaid Services, "2026 Medicare Parts A & B Premiums and Deductibles," cms.gov
• Social Security Administration, "Medicare Premiums: Rules for Higher-Income Beneficiaries," ssa.gov
• Internal Revenue Service, "Traditional and Roth IRAs," irs.gov
• Internal Revenue Service, "Publication 590-A, Contributions to Individual Retirement Arrangements," irs.gov
• Internal Revenue Service, "Publication 523, Selling Your Home," irs.gov