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Retired in 2012. Forced retirement with a 20,000 bonus for taking it. Put my AGI for 2012 higher on income limits. Filed a request for exception. Got it. On THAT form it asked for your proposed income would be for the next year. I put 30,000. Well I sold my rental, needing money for bills etc. That sale in 2013 put my AGI TO 218,000. When Medicare saw that in December of 2014 they had started taking out additional premium amts but also said I owed an additional 1200.00 which they promptly took out of my Janusry check leaving me with just 509.00 to live n for the month. In addition they are now taking out the maximum premium amouts for both B and the RX PLAN. so, in addition to my supplemental plan I'm laying out 335.00 a month. I've applied twice and have been denied. I had my 2014 taxes done and my AGI was 24,000. They've told me NOT to bother trying again. I'm trying to get up enough steam to give it another try as this will mean they've taken out over 4000.00 for medicare this year on a probably AGI again of only 24,000. I feel like I've hit a wall, I'm discouraged, scared, I'm 76 years old and to be going thru this at this time if my life just upsets me beyond belief. Any ideas out there?

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My husband and I will be in the same situation when we become eligible for Medicare in 2016 at age 65. Our full retirement age is 66, so my husband will work at least until then. The Medicare Part B and Part D premiums are determined by your income two years prior. So for 2016, the premiums are based on 2014 income as reported on your tax return. I have been told that this is because the federal government is a year or more behind on updating records. If you get a statement from social security each year, you may have noticed that they are a year or two behind on recording your income. Although our income will drop drastically when my husband retires, we will pay the higher premiums for at least two more years. When I asked my accountant about an appeal, she told me that none of her clients has ever been successful in requesting an appeal. One would think that in this digital age the tax records would be more current.
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My question is, Why should we be responsible for the governments failure to be current? If you read Medicaire Premiums in the plan there are exemptions to the regulation. Divorce, death, catastrophic disaster and some others. My thing is, we who fall into this one time higher income bracket because of a one timefinancial gain should be included in the regulation, which went into affect in 2012. By the way. There's nothing wrong with the law, it just needs to be tweaked. We should be able to fill out the form for the one time relief, provide documentation and be done with it. Again in my situation, if I provide my taxes for 2014 and it shows I'm below the income bracket causing the increase in the previous year I should be able to go back to a 'normal' premium amount. Two years of being behind, one is no excuse for us to be penalized and two IF information is provided showing the lower amount that should trigger the change. None of this makes any sense, in what they are doing! We should be refunded the extra premium we've had to pay and very able to move on. To me it's very very simple unless I'm really missing something here. This is just driving he nuts as it is SO wrong.
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Renee, yes, when you have a jump in your income, your Medicare premiums and taxes will be higher, but it is temporary. In 2016, if your income goes back to what it was before the temporary increase, then your premiums & taxes will go back down. This is the same treatment EVERYONE receives. Try not to take it personally---the math is the same---they are not targeting you, they are only looking at the numbers.
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It doesn't feel fair, but these situations need to be anticipated. There is probably nothing anyone can do in this situation--if you wanted to try to get food stamps maybe you could qualify for that, I don't know. But anyone who experiences a temporary windfall, has the same "problem", and feels it is not "fair" but how else would the governments collect their taxes and Medicare premiums? If they did it on a twice a year calendar with everyone filing their taxes that often, it would increase the IRS and Medicare administration costs immensely. I hope someone else here on Aging Care has a solution, but I don't know of any. Actually I am a bit jealous of your (temporary) income increase, would love to have that opportunity to do some needed expenses. But I wouldn't be surprised at the tax increases.
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If you have a gain from the sale of your main home, you may qualify to exclude up to $250,000 of that gain from your income. You may qualify to exclude up to $500,000 of that gain if you file a joint return with your spouse. Publication 523, Selling Your Home, provides rules and worksheets. Topic 409 covers general capital gain and loss information.
See a tax consultant about filing an amended 2014 tax return.
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I was thinking that Renee had to pay $28,000 in capital gains tax on his rental property investment that means he made a huge profit on the sale of that rental. That profit should more than make up what extra he needs to pay for Medicare.
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I found the 2015 chart. You are right, amounts depend on income. Scroll down to the chart. www.medicare.gov/your-medicare-costs/part-b-costs/part-b-costs.html

All in all, I remember back when I was an independent contractor paying $575 per month for health insurance just for myself, with no health issues, plus $2,500 deductible. Thus, when I was eligible for Medicare it has been a delight wallet wise for me.
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Sorry. I pay my taxes and the Federal Government got 28,000 from the sale of my property. Plus what I paid the state. If I was working or had a lot of investments, whatever and made a lot of money EVERY year I would expect to pay a higher premium. Also, there is no way to 'prepare' for an event like this. I had no idea that there would be an issue with the Medicare premium and for your information this change to the existing regulations was just made in 2012. I put this up on my FB page and I cannot begin to tell you how many people were NOT aware of this. So, how can you 'prepare' for something you are totally in the dark about. Prepare, yes for the Capitol Gain and taxes I 'prepared'. Secrets, on the other hand are a bit hard to 'prepare' for. Food stamps? I wouldn't, nor do I qualify for food stamps. I worked all my life for what I have. I was never rich, but was able to prepare for retirement in a manner of speaking. I have never had to take handouts and don't plan to start now. Will I get through this yes! But THAT DOES NOT make this fair!!
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I am not a tax accountant, but I think that some of the respondents here do not understand the situation. First of all, Renee sold a rental property, which does not qualify for any sort of capital gains exclusion. Secondly, just because the sale showed a profit on paper, that does not mean that Renee pocketed a huge sum of money. This property could have been fully depreciated and could have been subject to depreciation recapture when it came time to pay the taxes. There might have been a mortgage on the property, which would have needed to be paid with the sale proceeds in order to provide clear title to the buyer. For example, there could have been a taxable gain of $200,000 on a sale of $250,000, and if there was a loan balance of $190,000, by the time selling expenses, the mortgage balance and capital gains taxes were paid, the seller could end up with nothing. Of course, the seller had gotten the advantage of the depreciation claimed in prior years, but that doesn't help him now. There is a difference between income on paper and income in your pocket.

I think that Renee feels that it is unfair for Medicare to charge him a higher premium based on a "paper profit". I don't necessarily agree with his position for the year of the sale, however I agree that it is unfair to be charged a higher premium for three years, based on an increased income in one year. Unfortunately, this is how it is done. If I understand his post correctly, he was charged a higher premium retroactively for the year of the sale, and then for two more years because the premiums are based on tax return numbers that are at least two years old. Anyone who is nearing Medicare eligibility should be aware that your premiums will be based on income at least two years prior to your 65th birthday, and if you are still working with an upper middle class income, will be higher for at least two years after you retire and your income drops. Renee is correct that many people are not aware of this recent change in the law.
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Here are the numbers that probably apply for Renee: I am assuming that he is single. His Medicare Part B premium will be $335.70, Medicare Part D will be $70.80 plus his regular premium, which I will conservatively estimate at $30 (it depends on the plan he selects), and I will estimate his Medicare supplement policy at $200 at his age. The total is $636.50 per month, more than FF was paying before Medicare. FF was working and I presume earning an income while paying this premium, Renee is retired and living on SS income of $24,000. That is a pretty big chunk of his income. I wonder what coverage would be available to him and at what rate if he was under 65 and got coverage under the ACA. I think an income of $24,000 would have qualified him for a pretty hefty subsidy. Under the ACA you estimate what your income will be for the year and premiums are set accordingly. If you were wrong, you "settle up" when you file your taxes for that year. I wonder why Medicare couldn't use the same system.
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