How to Reverse Medicare Surcharge When Your Income Changes

by | Jan 2, 2019 | With Your Family in Mind

 Are you a high-income Medicare beneficiary who is paying a surcharge on your premiums but who has experienced a drop-in income or is anticipating one? If your circumstances change, you can reverse those surcharges.
Higher-income Medicare beneficiaries (individuals who earn more than $85,000.00) pay higher Part B and prescription drug benefit premiums. The Social Security Administration uses income reported two years ago to determine a beneficiary’s premiums. So the income reported on a beneficiary’s 2016 tax return is used to determine whether the beneficiary must pay a higher monthly premium in 2018. A lot can happen in two years.
You can request a review of your income if any of the following circumstances occurred:
You married, divorced or became widowed.
You or your spouse stopped working or reduced your work hours.
You or your spouse experienced a schedule cessation, termination, or reorganization of an 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.
You can submit documentation verifying the change in income – including tax documents, a letter from your employer, or a death certificate. If the change is approved, it will be retroactive to January of the year you made the request. Here is a link to the SSA’s Life Changing Event form:
Ms. MacDonald’s practice is limited to Estate Planning, Probate & Trust Administration. Ms. MacDonald maintains her practice in the Santa Clarita Valley at 25115 Avenue Stanford, Suite A-209, Valencia, California. She can be reached at 661-294-6464.

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