Stocks● Neutral
Selling Your Home Could Push Medicare Premiums Above $800 a Month
A home sale can spike taxable income and push retirees into higher IRMAA brackets. A couple with a $300,000 gain could see premiums jump from $406 to over $800 a month.
Continue with
Retirees selling a home they've held for decades face a surprise: a big check from the sale can mean higher Medicare premiums two years later. The mechanism is IRMAA, the income-related monthly adjustment amount, Fortune reports.
Medicare sets premiums based on tax returns from two years prior. A large capital gain from a home sale can push a retiree into a higher IRMAA bracket, even if their regular income is modest. Advisers said the sting arrives years after the closing check clears.
A couple with a $300,000 taxable gain from selling their house could see monthly Medicare premiums jump from roughly $406 to more than $800, Fortune said. That works out to thousands of dollars in extra annual costs.