Did you receive an IRMAA determination letter?
If you have recently experienced a life-changing event, you may be able to use Form SSA-44, (also known as Medicare Income-Related Monthly Adjustment Amount – Life Changing Event). The SSA-44 allows the Social Security Administration (SSA) to make the necessary corrections to lower or eliminate your IRMAA.
An IRMAA determination letter informs certain taxpayers of their higher premiums, based on their income. If you have, you might be wondering how to reduce (or avoid) your IRMAA surcharges on your Social Security benefits.
In this article, we’ll walk you step by step through:
- How the SSA-44 works
- When you might consider using the SSA-44
- Key information you can find on the SSA-44
- How to fill out the SSA-44
- What documentation you may need to send with your filled out SSA-44
- How to submit the SSA-44 for consideration
While this information is straightforward, government paperwork can be daunting. However, the instructions are pretty simple.
Please note: If there are two spouses on Medicare, you’ll probably each receive an IRMAA determination letter. If that’s the case, then you’ll need to do this for each spouse.
How the SSA-44 works
IRMAA (also known as Income-Related Monthly Adjustment Amount) is an increase in Medicare premiums based on income. In other words, the United States government uses your tax returns to determine whether you should pay more for Medicare than the standard premium. If IRMAA applies, you pay an additional surcharge for both Medicare Part B and Part D.
If your income tax returns reflect a higher modified adjusted gross income (MAGI), you’ll receive a letter known as an “Initial Determination Notice.” The Social Security Administration usually sends these notices in advance of the following year.
For example, 2022’s IRMAA letters were sent towards the end of 2021. However, those determinations were mostly based upon 2020 tax returns.
The reason for this is simply because 2021 hadn’t even finished. Because of this process, IRMAA determinations are (at best) based upon tax information that is two years old.
And a lot could have changed in your life between 2020 and 2022 that might have lowered your income. For example, many people retire and their income goes down.
In recognition of this, the SSA defines specific events that may have impacted your income as ‘life-changing events.’
Key Information You Can Find on SSA-44
Virtually everything you need to successfully complete the SSA-44 is found on the SSA-44 itself. However, it’s worth pointing out some of the useful things you can find on the form:
You don’t have to Google this, you don’t have to look it up anywhere. It’s right here on the form.
Here is the table for Part B premiums:
And here are the surcharges for Medicare Part D:
From here, you can figure out not only what SSA is billing you, but what you should be paying based upon your life-changing event.
For example, if your 2020 MAGI (modified adjusted gross income—more on that below under Step Two & Three) was $100,000 and you were single, then you would fall under the first IRMAA tier.
This means that you would be expected to pay an additional $68.00 in Part B premiums per month. Your Part D premiums would go up by $12.40 per month.
Let’s say you got married in 2021, but your income wasn’t expected to increase. This is a change in your tax filing status. That means you could be reconsidered as if you were married, filing jointly (which you probably would end up doing when you file your 2021 tax return).
In that case, your $100,000 MAGI would be under the IRMAA threshold and you wouldn’t pay any additional premiums.
In other words, you can use this table to have a pretty good estimate of where you’ll end up before you start filling out the paperwork.
It’s important to note that the SSA-44 not only contains details of each step, but clear instructions (starting on page 5 of the SSA-44) to give you guidance.
When You Might Consider Using the SSA-44
If a life-changing event has impacted your income, then you would use the SSA-44 to request a reconsideration of the new facts for a new IRMAA determination.
Submitting an SSA-44 is not an appeal—it’s actually much simpler. An SSA-44 asks the SSA to consider new income-related facts as if they were part of the initial determination.
How to fill out the SSA-44
There are five steps to filling out the SSA-44. We will break down each step of the SSA-44 so you can clearly understand what is required.
Step One: Type of Life-Changing Event
This is the type of life-changing event that happened in your life, and when it occurred. The eight types of life-changing events that SSA will consider in their IRMAA determination are:
- Marriage-You entered into a legal marriage
- Divorce/Annulment-Your legal marriage ended, and you will not file a joint return for the year.
- Death of your spouse-Your spouse died.
- Work Stoppage-You or your spouse stopped working.
- Work Reduction-You or your spouse reduced your work hours
- Loss of Income-Producing Property-You or your spouse experienced a loss of income-producing property not under your control. Examples of this would include disaster, losing property due to arson, fraud or theft
- Loss of Pension Income-You or your spouse experienced some sort of disruption (cessation, termination, or reorganization) of an employer’s pension plan.
- Employer Settlement Payment-You or your spouse receive a settlement from your employer/former employer because of bankruptcy.
SSA 44 Step One asks what type of life-changing event occurred and when it happened. This step also asks for the date that the event took place, because it must be in the same tax year or an earlier tax year than the one you ask SSA to consider.
Let’s imagine that the SSA calculated the 2022 IRMAA with 2020 tax information. However, you got married in 2021. In that case, you could use the 2021 information instead.
Step Two: Reduction in Income
This is where you fill in the modified adjusted gross income (MAGI) for the given tax year. For most people, the 2020 tax data would have gone into the 2022 IRMAA calculation.
The SSA calculates your MAGI using two lines on your tax return:
- Adjusted Gross Income (Line 7 of Form 1040 from your tax return)
- Tax-Exempt Interest (Line 2A of Form 1040 from your tax return). An example of tax-exempt interest would be municipal bond interest.
SSA 44 Step Two asks for your tax information and filing status for the tax year in question.
You’ll simply fill in this information, as well as the tax filing status for that year. Be sure that you only report what was already reported on your tax return. Don’t change anything here. That will be in Step 3.
Step Three: Modified Adjusted Gross Income
This is where you estimate your income to be based upon your life-changing event. This step has three parts:
- Will your MAGI be lower next year than the year in Step 2?
- If the answer is ‘Yes,’ then you’ll complete the rest of Step 3.
- If the answer is ‘No,’ then you’ll skip to Step 4.
- Note: It doesn’t always have to go down. For example, if you got married, but your income didn’t change, then you would answer ‘No’ and move to Step 4.
- Fill in the Tax Year, estimated AGI, and estimated tax-exempt interest. If you work with a financial advisor or a tax professional, then they can run a tax projection for you based upon your life-changing event. If not, then you might have to do this yourself.
- Expected Tax Filing Status. If your tax filing status hasn’t changed, then this should be straightforward. However, if you got married or divorced, or became a widow(er), then this might be a little difficult. Below is a little background.
According to the IRS, your filing status is based upon your marital status as of December 31 of the year on your tax return.
Marriage: If you got married before December 31, then you can file as married (either jointly or separately). If you get married on January 1 of the next year, then you would file as single (unless you are filing jointly with a deceased spouse for the year in question).
Divorce: If your divorce decree is finalized before the end of the year, then you would file as Single. If your divorce becomes effective on January 1 or later, then you would file as married (either separately or jointly).
Deceased Spouse: If your spouse died, then you can file a joint tax return for the year in which they died. After that, you’ll either file as single (if you didn’t remarry), married (if you did remarry), or qualifying widow(er) (if you have a dependent child). If you are able to file as a qualifying widow(er), that privilege exists for the two tax years after your spouse’s death.
The IRS has a page where you can determine your filing status: What is my Filing Status? It takes about 5-10 minutes to walk through.
SSA 44 Step Three asks for your expected MAGI for the year following the year of your life-changing event.
Step Four: Documentation
In this step, you’ll collect the required documents (or certified copies of those documents), depending on your life-changing event. You can find this list on page 8 of the SSA-44.
Hint: If you only have one copy of the document, you may want to get a copy so you can keep the original.
In the case of a work stoppage or reduction, you simply need to sign a statement (under penalty of perjury) that you’ve partially or completely stopped working, or that you took a job with less compensation.
While the SSA returns all submitted documents, you should keep a copy for your own records.
SSA 44 Step Four asks for supporting documentation.
Step Five: Signature
You’ll sign the document under penalty of perjury. In other words, if you attempt to defraud the government, you can face penalties. So this form should only be completed if you’re sincere.
You’ll also want to provide a copy of your tax return, which will help speed up the determination process.
SSA 44 Step Five asks for your signature (sworn under oath).
How to submit the SSA-44 for consideration
You can call your local Social Security office for instructions on how to submit the SSA-44 and supporting documentation. To find the closest Social Security office to you, go to the Social Security Office Locator and type in your zip code.
Sometimes, dealing with the government can be a daunting and frustrating task. This is especially true when you’re facing an IRMAA bill you feel that you shouldn’t be paying. However, the Social Security Administration has taken great steps to simplify the process outlined on the SSA-44.
If you feel that you cannot make progress on your own, then talk with your financial advisor about helping you with the paperwork.
After retiring from a 24-year career as a Naval officer in 2017, Forrest became a financial planner to help people achieve success in managing their personal finances. In 2022, he sold his partnership stake in his financial planning firm to focus on helping people full-time through his writing.
Featured in: Forrest’s writing has been featured in the following publications: Forbes, Military.com, NerdWallet, Yahoo Finance, The Military Guide, The Military Wallet, Christian Science Monitor, and many other publications.
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