The Medicare Part B monthly premium will rise to $185 for 2025. However, upper-income seniors have to pay even higher Part B and D premiums if their modified AGI (adjusted gross income) for 2023 exceeded $212K for joint or $106K for single filers. Modified AGI is AGI plus any tax-exempt interest income.
For example:
Single Filers, MAGI $106-133K, Part B premiums will be $259.
MFJ filers, MAGI $212-266K, Part B premiums will be $259.
Single Filers, MAGI $133-167K, Part B premiums will be $370
MFJ filers, MAGI $266-334K, Part B premiums will be $370
The premiums can scale up to $628.90 with MAGI of $499,999 and $ $749,999.
This can be quite a shock for taxpayers who receive a windfall of income through the sale of a property or business. The tricky thing is that the 2023 income determines the 2025 Part B premiums. This delayed effect surprises many people.
These higher Part B premiums can be mitigated or avoided altogether with some proactive tax planning.
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