Posted on October 12, 2006 at 12:31:11:
High-income taxpayers face a stiff increase in Medicare Part B premiums, starting next year. Hardly anyone noticed a provision in the 2003 Medicare law that called for a premium surcharge starting in 2007, based on a means test for beneficiaries, but letters will go out next month to those likely to be affected.
This first year’s surcharge will be based on 2005’s adjusted gross income, plus tax-exempt interest, EE bond interest used for educational purposes and any excluded foreign income. It will affect single people with a modified AGI of $80,000 and married couples with a modified AGI of $160,000 or more. For 2007, the premium for everyone is expected to be close to $100; the surcharge will be at least 13.3 percent. But it rises sharply, and couples with income over $400,000 will pay a 73.3 percent surcharge. Surcharges for later years will be even higher, the percentages doubling and tripling. There are options for those in special circumstances.