A 2024 Roth conversion helped push one retiree’s Medicare costs high enough in 2026 to wipe out his Social Security raise and leave him worse off by $123 a month. The 67-year-old single retiree saw a $117 increase from the 2.8% COLA, then watched a $240 monthly IRMAA surcharge swallow it and more.
That is why the Social Security 2027 Cola Forecast has become more than a simple guess about benefits. For retirees who crossed a Medicare income line two years earlier, the raise can arrive with a bill attached. In this case, the retiree’s monthly Social Security benefit was $4,200, and a 2.8% boost worked out to about $117 more each month, or $1,411 over the year.
The retired filer’s usual MAGI was around $80,000, but the one-time conversion in 2024 lifted it to $140,000. Under Medicare’s income-related monthly adjustment amount rules, the Social Security Administration used that tax return two years later to set 2026 premiums, and the surcharge came on top of the standard $202.90 Part B premium. The result was not a modest trim to his raise. It was a monthly loss.
That lag is the part many retirees miss. A single-year income spike can echo into Medicare costs a year and a half later, long after the transaction that caused it has faded from view. Roth conversions are often done to reduce future required minimum distributions and future taxes, but they can also pull a retiree over an IRMAA threshold that sits frozen near $109,000 while prices keep moving. In this case, the Medicare charge nearly doubled the bill in 2026 after the agency used the 2024 return.
The math is unforgiving. Splitting large Roth conversions across multiple years can keep MAGI below the $109,000 threshold and reduce the chance of a premium hit later. But for this retiree, the question is already decided for 2026: the conversion delivered a tax-planning benefit on one side and a $123 monthly loss on the other. What remains open is whether the future tax savings will ever outweigh the Medicare surcharge that followed.
