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How are my Medicare premiums calculated?

By Karin Price Mueller | for

Q. My modified adjusted gross income (MAGI) was based on my 2020 tax returns when both my husband and I were working. I retired and reached full retirement age in January 2022. My husband passed away that same month. At this point, I have no income. I applied for Medicare A and B and based on my MAGI the amount is $374.20 — $170.10 for standard plus $170.10 for Income-Related Monthly Adjustment Amount (IRMAA). I have an appointment to explain why it should be reduced due to my husband’s death. I was told I will need to tell them what my estimated adjusted gross income will be in 2022. When I calculate this, what is considered income?

— Widow

A. We’re sorry to hear about your husband’s death.

Let’s cover how this all works.

For the uninitiated, Income-Related Monthly Adjustment Amount (IRMAA) is an additional amount some people pay for Medicare if their income is above a certain level.

Medicare Part A is free except that you paid into it over your entire working career, said Bernie Kiely, a certified financial planner and certified public accountant with Kiely Capital Management in Morristown.

“Medicare Part A covers the hospital bed, nursing care and bad food,” he said. “Medicare Part B covers medical procedures and doctor’s care.”

He said everyone pays a monthly premium for Medicare Part B.

“The premium is based on your income from two years ago,” Kiely said. “The reason it’s two years ago and not last year’s income is because if you are on a tax extension for 2021, you haven’t filed an income tax return yet for 2021.”

So what’s considered income? Kiely said you need to do is look at your 1040 income tax return.

“Income is salaries and wages, interest, dividends, capital gains, IRA distributions, pension income and Social Security income,” he said. “When you go to your appointment, I recommend you bring a copy of your 2020 income tax return so you can explain how your circumstances have changed.”

Email your questions to

Karin Price Mueller writes the Bamboozled column for NJ Advance Media and is the founder of Follow NJMoneyHelp on Twitter @NJMoneyHelp. Find NJMoneyHelp on Facebook. Sign up for’s weekly e-newsletter.


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