TODAY'S PAPER
70° Good Evening
70° Good Evening
LifestyleRetirement

Ask the Expert: How is my Medicare premium determined?

I know my current Medicare premium is based on my 2018 Modified Adjusted Gross Income (MAGI). But I don't know how to find my MAGI. I'm trying to figure out if I qualify for a premium reduction because my income is now much smaller than in 2018.

There's no line on your federal tax return showing Modified Adjusted Gross Income. That's because MAGI has no single definition. Several federal health programs use it to determine program eligibility, premiums and tax credits, and they define MAGI differently depending on the purpose for which it's calculated.

But in every case, the calculation starts with your adjusted gross income, or AGI. On your 2018 tax return, your AGI appears on line 7 of Form 1040. On your 2019 return, it's on line 8.

AGI includes your earned income; your investment income (such as dividends, taxable interest payments and capital gains); distributions from tax-deferred retirement accounts; and alimony. Not included: gifts, inheritances, tax-exempt interest (for example, interest from state and local bonds). Also excluded: between 100% and 15% of your Social Security income, depending on your other income.

Your MAGI is your AGI plus some types of income that were excluded from AGI.

For Medicare purposes, MAGI adds back into your AGI your tax-exempt interest income; interest from U.S. savings bonds used to pay for eligible higher education expenses; and income earned overseas that wasn't included in your gross income.

The bottom line

You pay a Medicare premium surcharge if your 2018 MAGI was over certain thresholds. But you can apply for a waiver if your income has fallen because of one or more life-changing events. They include marriage; divorce; death of a spouse; loss of a job; work reduction; loss of pension income; loss of income-producing property; or employer settlement payment.

More information

nwsdy.li/MedicarePartBcosts

https://nwsdy.li/MedicarePremiumAppeals

TO ASK THE EXPERT Send questions to act2@newsday.com. Include your name, address and phone numbers. Questions can be answered only in this column. Advice is offered as general guidance. Check with your own consultants for your specific needs.

More Lifestyle