They look at your Adjusted Gross Income plus Tax-exempt Interest Income. They call this your MAGI.
If you file Joint then if MAGI is over $170,000, you will pay a higher Medicare Part B and Medicare prescription drug premium.
For other filing statuses, you pay higher premiums if MAGI is over $85,000.
If income goes down, you can get your monthly adjustment amount changed in certain circumstances:
- change in marital status (divorced, married, or became widowed)
- change in work hours for you or spouse or if one of you stopped working
- you or your spouse experienced a scheduled cessation, termination, or reorganization of employer’s pension plan
- you or your spouse received a settlement from an employer or former employer because of the employer’s closure, bankruptcy, or reorganization
The average Part B premium for 2017 is $109. For those that first enroll in 2017 or don’t have premiums deducted from Social Security the basic premium increases to $134.
The premiums go up anywhere from $53.50 to $294.60 ($214.30-$294.60 if filed Married Filing Separate) more per month depending on the income amount.
For more info and to see the specific increase for each income amount click here. See page 5 and 6 for the chart.