We Sold an Investment and Our Medicare Part B Premiums Shot Up to $592. Can We Avoid This Increase?

March 4, 2025 | by ltcinsuranceshopper

I sold an investment property which made my income very high for that year. Medicare Part B premiums increased to $591.90 for both me and my wife. Is there any way to avoid that increase? Our Part D premiums increased as well.

-Fred

First off, congratulations on selling your investment property. Unfortunately, there likely isn’t anything you can do at this point to avoid the increase in your Medicare premiums. However, the good news is that the increase is not permanent. Let’s take a closer look at how your income impacts your Medicare premiums.

A financial advisor can help you navigate the ins and outs of retirement income planning, including increases to your Medicare premiums. Connect with a fiduciary advisor today.

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Medicare provides health insurance to a majority of American citizens who are 65 or older. There are multiple parts, each with their own premiums.

Part A: This portion provides your inpatient hospital coverage, which includes skilled nursing facilities, hospice and some at-home care. Most people won’t pay a premium for Part A, but that doesn’t mean it’s free. You paid for it over your working life through payroll deductions.
Part B: This is your medical insurance for which you’ll pay a monthly premium. The standard premium is set each year, and for 2025, it’s $185.
Part C: Also called Medicare Advantage, this is a private, combined coverage in lieu of Parts A and B, and often Part D. Like other private insurance, the premium depends on the plan you choose.
Part D: This is the prescription drug coverage the Medicare provides. Again, those who choose to enroll in this part will pay a monthly premium. As there are multiple plans that provide different coverage, your premium depends on the Part D you choose.

(And if you need help planning for healthcare expenses in retirement, consider working with a financial advisor.)

The premiums you pay for Parts B and D are subject to income-related monthly adjustment amounts (IRMAA). The higher your income, the higher your premiums will be. The levels are adjusted each year. The married filing joint income levels at which IRMAA applies for 2025 are:

2025 Part B Income-Related Monthly Adjustment Amounts

Modified Adjusted Gross Income (for beneficiaries who file joint tax returns)	IRMAA Surcharge	Total Monthly Premium
Up to $212,000	$0	$185
Above $212,000 and up to $266,000	$74	$259
Above $266,000 and up to $334,000	$185	$370
Above $334,000 and up to $400,000	$295.90	$480.90
Above $400,000 and less than $750,000	$406.90	$591.90
$750,000 or above	$443.90	$628.90

As you can see, the IRMAA surcharges are added to each spouse’s monthly Medicare Part B premium.

2025 Part D Income-Related Monthly Adjustment Amounts

Modified Adjusted Gross Income (for beneficiaries who file joint tax returns)	IRMAA Surcharge
above $212,000 up to $266,000	$13.70
above $266,000 up to $334,000	$35.30
Above $334,000 up to $400,000	$57
Above $400,000 and less than $750,000	$78.60
$750,000 or above	$85.80

Again, each person must add the surcharge to the amount they already pay for their specific plan.

Something to keep in mind is that IRMAA is applied to your income from two years prior. So, the IRMAA you pay in 2025 (the rates in the tables above), is based on your income as reported on your 2023 tax return. It also only applies one year at a time. Just because you have to pay it in 2025 due to your 2023 income doesn’t mean you’ll pay it again in 2026. Your IRMAA in 2026 will be based on your 2024 income.

(And if you have additional questions around IRMAA, consider using this free tool to match with an advisor and talking it over.)

We really need to think of this question from two angles.

The first is from the perspective of someone in your position. You have already triggered your IRMAA surcharge for 2025 based on your 2023 income. The general answer is that no, you are not able to avoid the surcharge at this point. It’s pretty cut and dried.

There is a possible exception though: if you have experienced a major life event since 2023. You may request to lower your IRMAA surcharge if your income has dropped due to:

However, if you’re thinking about what you can do in 2025 to avoid IRMAA in 2027, that’s a different story. If you income is flexible, you need to stay below a given IRMAA threshold.

One somewhat unfortunate reality is that the IRMAA brackets are not published until just a few months before the year they will apply. The Social Security Administration announced the 2025 brackets in November 2024. So, what this means is you have to estimate the 2027 brackets in 2025. I generally recommend a simple inflation increase of the 2025 brackets.

However, don’t assume that avoiding IRMAA every year is always the best approach. Just like Roth conversions sometimes make sense even though they increase your current-year tax liability, concentrating asset sales or other income increases in a given year can ensure IRMAA surcharges remain a one-time occurrence instead of a recurring annual expense.

(Remember, a financial advisor can help you manage your income in retirement and plan around IRMAA surcharges. Connect with an advisor today.)

Generally, once you are subject to an IRMAA surcharge, you cannot avoid it. If you have experienced a life-changing event that reduces your income, there may be an exception. Looking forward though, it is a good idea to plan around IRMAA and consider it in your retirement income plan.

A financial advisor can help you build and manage streams of income in retirement, as well as navigate the potential consequences of income increases. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
Traditional IRAs and 401(k)s require you to start taking required minimum distributions (RMDs) at age 73 (75 if you were born in 1960 or later), which can increase your taxable income. Strategically withdrawing funds before RMDs begin – such as through Roth conversions – can help manage taxes and extend the life of your savings.
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Brandon Renfro, CFP®, is a SmartAsset financial planning columnist and answers reader questions on personal finance and tax topics. Got a question you’d like answered? Email AskAnAdvisor@smartasset.com and your question may be answered in a future column.

Please note that Brandon is not an employee of SmartAsset and is not a participant in SmartAsset AMP. He has been compensated for this article. Some reader-submitted questions are edited for clarity or brevity.

The post Ask an Advisor: We Sold an Investment and Our Medicare Part B Premiums Shot Up to $592. Can We Avoid This Increase? appeared first on SmartReads by SmartAsset.

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