business
RMD Tax Trap: How $122,000 in 401(k) Withdrawals Can Cost You $42,000 in IRMAA Surcharges Alone
Key takeaways
- Medicare's 2-year income lookback means three consecutive RMDs lock in three separate years of top-tier surcharges, totaling roughly $42,000 for the couple.
- A qualified charitable distribution of up to $111,000 per person in 2026 can reduce MAGI enough to drop below the top IRMAA cliff and recover the surcharge.
- SmartAsset's free tool can match you with a financial advisor in minutes to help you answer that today.
RMD Tax Trap: How $122,000 in 401(k) Withdrawals Can Cost You $42,000 in IRMAA Surcharges Alone Marc Guberti Mon, June 29, 2026 at 8:22 PM GMT+7 5 min read Quick Read A $122,000 RMD pushed Margaret and her husband into the top IRMAA tier, adding $13,872 per year in Medicare surcharges on top of normal premiums.
Medicare's 2-year income lookback means three consecutive RMDs lock in three separate years of top-tier surcharges, totaling roughly $42,000 for the couple.
A qualified charitable distribution of up to $111,000 per person in 2026 can reduce MAGI enough to drop below the top IRMAA cliff and recover the surcharge.
Article preview — originally published by Yahoo Finance. Full story at the source.
Read full story on Yahoo Finance →
More top stories
Aggregated and edited by the Scoop newsroom. We surface news from Yahoo Finance alongside other reporting so you can compare coverage in one place.
Editorial policy · Corrections · About Scoop