If you find yourself in Medicare’s IRMAA there is always the opportunity to appeal the decision. The key, to appealing, is to ensure that one of the Life Changing Events (LCE) that the Social Security Administration (SSA) will accept fits your circumstance.
We highly recommend that if any one of these Life Changing Events applies to you that you immediately file an appeal as soon as possible.
For more information on how to appeal IRMAA please click here or you can always contact one of the many IRMAA certified Professionals in the country.
What are the Life Changing Events that the SSA will accept?
A Life Changing Event (LCE) is any incident that will cause your modified adjusted gross income to decrease now that you are on Medicare.
The LCE’s that are accepted by the Social Security Administration (SSA) are:
- Death of Spouse.
- Marriage
- Divorce or Annulment.
- Work Reduction.
- Work Stoppage.
- Loss of Income Producing Property.
- Loss or Reduction of Pension Income.
- Receipt of Employer Settlement Payment.
Before the SSA will accept any Life Changing Event you must first be able to chow that your income will be decreasing and then also provide:
- A request, either in writing or verbally that the SSA should use different tax information when determining if you are in IRMAA (SSA-44 form),
- Provide an estimate of what your MAGI will be going forward.
- Provide what your tax status will be (filing single or joint for example).
- Provide your previous tax return which you will need to sign.
What is consider Proof for each Life Changing Event:
Death of Spouse:
- Proof can be a death certificate or a statement from a funeral director (form SSA-721).
Marriage:
- With marriage the SSA will accept “valid ceremonial marriages, “common law marriages” and non-marital legal relationship (civil unions and or domestic partnerships)
- Proof can be a marriage certificate or a beneficiary’s attestation under penalty of perjury regarding.
Divorce or Annulment:
- The SSA will accept court documentation as proof.
Work Reduction:
- The SSA considers work reduction to be a partial retirement or a change from full-time employment to part-time employment.
- Proof can be:
- A statement from an employer,
- Past and current pay stubs showing a change in hours,
- Corporate minutes,
- Record of business transfer (Self-Employment), or
- Beneficiary’s attestation under penalty of perjury, regarding reduction in work hours.
Work Stoppage:
- The SSA considers work stoppage to be retirement, a lay-off, and/or sale of business or corporation.
- Proof can be:
- A statement from an employer,
- A retirement letter,
- Corporate minutes,
- Record of business transfer or sale, or
- Beneficiary’s attestation under penalty of perjury regarding the work stoppage or employment separation
Loss of Income Producing Property:
- The SSA considers any significant reduction of income due to a loss of income-producing property that is beyond the beneficiary’s, or the beneficiary’s spouse’s, control (e.g. natural disaster, arson or criminal theft).
- Some examples of income producing property are:
- Real property (e.g., farmland, rental homes),
- Crops,
- Livestock and other animals (e.g., show dogs),
- Vehicles used for business, (e.g., limousines, tractor-trailers).
- Examples of circumstances beyond a beneficiary’s control are losses caused by:
- Natural disasters (such as flood, hurricane, tornado, fire, earthquake, volcano eruption)
- Disease (affecting crops, livestock or other animals)
- Arson
- Buy-out of the property by a government under Eminent Domain
- Theft (including the taking of money or property by blackmail, burglary, embezzlement, extortion, larceny, robbery, fraud, investment fraud or other criminal activity).
- Proof can be:
- A filed tax return which documents the loss of income from income-producing property, or
- A statement from the beneficiary alleging he is not insured and will provide a filed tax return which documents the loss of income from income-producing property once it has been filed (only if the LCE request is for the current tax year), or
- Insurance Claims regarding the loss of income producing property, or
- A statement from an insurance adjuster regarding the loss of income producing property, or
- A formal statement made by a policy owner to an insurer regarding the loss of income from the property.
Loss or Reduction of Pension Income.
- To qualify for this LCE the pension must be a traditional defined benefit pension plan or a Cash Balance plan, and the loss must be a result of:
- “A plan failure or termination (e.g. through bankruptcy restructuring), or
- A scheduled cessation that the beneficiary made a decision about some time in the past. For example, the beneficiary chose to take a 20-year annuity rather than a lifetime pension when they retired in 1986”.
- Proof can be:
- A letter from the pension administrator explaining the change in the annuity amount or cessation of annuity or
- The “original documents recording retirement distribution choices. The documents should show a date when the distributions will stop, or the fact that the payment was a lump sum distribution”.
Receipt of Employer Settlement Payment.
- To qualify for this LCE the Medicare beneficiary must be receiving a settlement payment from a current or former employer.
- The settlement payment must be due to the employer or former employer’s closure, bankruptcy or reorganization.
- Proof can be:
- A statement from an employer,
- Court document showing settlement and terms, or
- Statement from the employer’s attorney stating settlement and terms.
Conclusion
When it comes to appealing IRMAA there are many reasons that the Social Security Administration will accept they key is to utilize the above Life Changing Events.
Remember, when appealing you will need to provide proof of the event as well as being able to prove that your income going forward will be lower.
For more information on how to calculate the income that you will need for IRMAA please click here.
AND as always if you have questions regarding IRMAA, please feel free to contact any IRMAA Certified Professional…it is what they do.
For a director if IRMAA Certified Professionals click here.
