Short answer: For Medicare Part B and Part D IRMAA, start with federal AGI. A pre-tax 401(k) deferral usually lowers W-2 taxable wages before AGI is calculated.
Why Reddit gets stuck here
MAGI is not one universal formula. Some tax benefits add back certain retirement deductions. IRMAA is different: the SSA form describes the income measure as adjusted gross income plus certain tax-exempt income.
Practical planning formula
For IRMAA planning, use this working formula:
Medicare MAGI = AGI + tax-exempt interest
If a pre-tax 401(k) contribution lowers the wages that flow into AGI, it may help keep Medicare MAGI below a threshold. Roth 401(k) contributions do not reduce taxable wages the same way.
Education sponsor placement for working-past-65 Medicare planning or retirement income resources.
What it does not change
IRMAA does not apply to Medicare Part A. It can apply to Medicare Part B and Part D. Also, itemized deductions such as charitable deductions or SALT deductions happen after AGI, so they generally do not reduce Medicare MAGI.
Checklist before year-end
- Estimate W-2 wages after pre-tax deferrals.
- Add taxable Social Security, pensions, IRA withdrawals, Roth conversions, capital gains, dividends, and interest.
- Add tax-exempt interest such as municipal bond interest.
- Compare the result with the next IRMAA threshold.
Next step: run the calculator and save the IRMAA planning checklist.