IRMAA Basics
How Capital Gains Impact IRMAA Calculations for Medicare
Verified against SSA POMS as of August 20, 2026
The short answer
Capital gains are considered part of a persons adjusted gross income and can affect your Medicare Part B and D premiums through the Income-Related Monthly Adjustment Amount (IRMAA). For IRMAA purposes, capital gains are included in your Modified Adjusted Gross Income (MAGI) and can influence premium amounts. MAGI is calculated using your adjusted gross income plus tax-exempt interest. If capital gains increase your MAGI above certain thresholds, your IRMAA may increase.
Capital Gains and MAGI
Capital gains are included in your Modified Adjusted Gross Income (MAGI) and can influence the IRMAA calculation for both Medicare Part B and Part D premiums. MAGI includes your adjusted gross income plus certain non-taxable income. Capital gains are part of your adjusted gross income, and occur when you sell an asset for a profit. If these gains elevate your MAGI above specific dollar thresholds, it can result in a higher IRMAA for that year. The IRMAA dollar thresholds are the same for both Medicare Part B and Part D.
HI 01194.005 View source ›Effect on IRMAA
Capital gains will cause an increase to your MAGI, and may push you into a higher IRMAA bracket, thereby increasing your Medicare Part B and Part D premiums for that year.
HI 01194.105 View source ›Reporting Capital Gains
Beneficiaries must report capital gains on their tax returns. Capital gains represent a sale of an asset for a profit and are included in adjusted gross income on the IRS Form 1040. The IRS provides the Social Security Administration with details about your tax return, which includes a beneficiary's adjusted gross income (AGI). Capital gains are a component of AGI. Failure to report these gains can lead to incorrect calculations of your MAGI and IRMAA.
SI 02310.048 View source ›Frequently asked
Can capital gains affect my Medicare premiums?
Yes, capital gains can affect your Medicare B and D premiums by increasing your Modified Adjusted Gross Income (MAGI) above the IRMAA thresholds. Modified Adjusted Gross Income is the sum of tax exempt interest and adjusted gross income (AGI), and capital gains are a component of AGI.
How do capital gains influence my IRMAA?
Capital gains are considered part of your Modified Adjusted Gross Income (MAGI). If they push your MAGI over certain dollar thresholds based on tax filing status, you will incur IRMAA surcharges for Medicare Part B and D.
Will my IRMAA permanently increase due to capital gains?
No, capital gains affect your IRMAA only for the year they are realized. Capital gains, which represent the sale of an asset for a profit, are considered one-time income and are recalculated annually based on the tax year they occur. IRMAA is also recalculated annually based upon the tax return 2 years prior to the Medicare premium year. Your modified adjusted gross income on your Form 1040 will vary from year to year. Thus, you can have IRMAA surcharges one year and escape them the next year.