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How will my tax return affect my Medicare premium?

rickandcindy23

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Good to know. It will be interesting to see how it will go for us next year. We are now 64.
 

WinniWoman

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Our financial planner has factored this into our retirement income plan. There is just so much to think about once you retire, especially with no pensions to live off of. For us, he has us spending down taxable accounts first and doing Roth conversions until age 70 when we both should take SS and will be required to take RMD's. He is trying to lower taxes as much as possible and one thing he mentioned was it's effect on our Medicare premiums- and ACA premiums should I need that insurance before I am eligible for Medicare.
 

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The title of the thread actually caused me to click and read, but since it is about "High Income" tax returns, it was not about us.

But, if I/we ever magically become "High Income", I will keep this in mind.

:cool:
 
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WinniWoman

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The title of the thread actually caused me to click and read, but since it is about "High Income" tax returns, it was not about us.

But, if I/we ever to magically become "High Income", I will keep this in mind.

:cool:


But the concept is the same. We are not high income at all nor will we be when retired. Yet you would be surprised how the income you have affects your premiums.
 

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Maybe I read it wrong.
 

VacationForever

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But the concept is the same. We are not high income at all nor will we be when retired. Yet you would be surprised how the income you have affects your premiums.
Unless your income is > $170K per year, Medicare premiums surcharge should not affect you. ACA is a different story... it depends on how much you are going to convert to Roth as withdrawals from IRA is treated as income.
 

rapmarks

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Your social security will go up if you make over $170000 a year as a couple. That will be about $65 a month extra each. Then there are graduated steps up to making over &750000 a year. You can’t worry about not having enough money to live on and about the extra Medicare premium at the same time. If you make a big capital gain, it will only affect you that year, not your lifetime.
 

WinniWoman

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Unless your income is > $170K per year, Medicare premiums surcharge should not affect you. ACA is a different story... it depends on how much you are going to convert to Roth as withdrawals from IRA is treated as income.


Oh, I see. I didn't realize that was the number. Our income won't be anywhere near that! LOL! I must have misunderstood the FA. He did mention the ACA also, though, so that is probably what he was saying since I have a few years left for Medicare.

This is why we need a FA. I am not that smart about this stuff. I try to learn, though.
 

bogey21

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I don't know the level where income becomes significant figuring there is nothing I can do about it. $170,000 sounds a bit high though. What I do know is that the amount deducted from my Social Security for Medicare Part B has escalated quite a bit based on my income as reported on my FIT Returns...

George
 

VacationForever

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I don't know the level where income becomes significant figuring there is nothing I can do about it. $170,000 sounds a bit high though. What I do know is that the amount deducted from my Social Security for Medicare Part B has escalated quite a bit based on my income as reported on my FIT Returns...

George
Because your are single, Medicare surcharges start at $85K.
 

WinniWoman

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You know, I am going over the Financial Advisors' preliminary plan because we have a meeting tomorrow.

Turns out I am not crazy. He wrote in there that we should do the Roth conversions in the next few years to lower our tax bite when we have to start taking SS and RMD's at age 70 1/2 and also to lower Medicare premiums.

I guess I will have another question for him tomorrow because our income would not be $170,000 per year- no where near it.

My head is spinning. Still looking for the fun in retirement.
 

VacationForever

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I guess I will have another question for him tomorrow because our income would not be $170,000 per year- no where near it.

You need to look at when you turn 70 yo:

Your SS + your husband's SS + your RMD + your husband's RMD + your mother's RMD from her IRA inheritance + taxable account dividends and interests. You need to bake in growth to your accounts for when you will turn 70. If the estimated total is > 170K, then you need to worry about Medicare premium surcharges. Otherwise, don't worry about it.
 

rapmarks

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You need to look at when you turn 70 yo:

Your SS + your husband's SS + your RMD + your husband's RMD + your mother's RMD from her IRA inheritance + taxable account dividends and interests. You need to bake in growth to your accounts for when you will turn 70. If the estimated total is > 170K, then you need to worry about Medicare premium surcharges. Otherwise, don't worry about it.
Plus it will be higher thresholds by then.
 
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