This is my annual warning to anyone 63 or older who plans on paying for Medicare Part B and/or a Drug plan at age 65. The idiotic tax treatment of gambling income may result in much higher Medicare and Drug plan premiums if you have W-2G income. Gambling wins are added to your adjusted gross income before losses to determine your Medicare premium.
Here are the income levels for filing single: $85,000, $107,000, $160,000, and $214,000. The Medicare Part B premium remains the same in 2015 at $104.90. Here are the extra premiums for the higher income levels: $42.00, $104.90, $167.80, and $230.80. So if your gambling wins bring your total income over $107,000 next year you will have to pay an additional $104.90 or double the base premium. Depending on your income you may be just a few W-2Gs from much higher Medicare premiums. The extra premiums will apply each year depending on your adjusted gross income and it is based on the tax return you filed 2 years ago. If you turn 63 next year your gambling in 2015 may determine your Medicare premiums when you reach 65.
The premium increases for drug plans are smaller. Here are the extra premium amonts: $12.30, $31.80, $51.30, and $70.80. The income thresholds for filing married are just double the levels for filing single. You can find all this information and more on the Social Security website.
Happy New Year!
Chris
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Posted by: cy4873@hotmail.com
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