Chapter 13: Ten Ways to Stay Under the Line
The worksheets from Chapter 13 of Fifty-Five. Type your own numbers, or try an example from the book to see how each one works.
The MAGI cost of the cash you need
How much one account adds to your MAGI when you take cash out of it, and how much room that leaves under your IRMAA line. Run it once for each account you could draw from.
The formula: From a pre-tax IRA or 401(k): MAGI added = Cash you take. From a taxable account: MAGI added = Cash you take × (Gain ÷ Value). From a Roth IRA (qualified), an HSA for medical costs, or cash savings: MAGI added = $0.
The calculator needs JavaScript. The paper worksheet below does not: it is the same arithmetic, written out.
The paper worksheet
Pre-tax IRA or 401(k): Cash you take $__________ × 1 = MAGI added $__________
Taxable account: Cash you take $__________ × (Gain ÷ Value = ______) = MAGI added $__________
Roth IRA (qualified), HSA for medical costs, cash: Cash you take $__________ × 0 = MAGI added $0
MAGI before this cash $__________ + MAGI added $__________ = New MAGI $__________
Your line $__________ − New MAGI $__________ = Room left $__________
Walk through it, step by step
- From your income map, write your MAGI for the year before you take the cash you need.
- Write how much cash you need.
- For a taxable investment, find its value and its cost basis on your statement. Subtract basis from value to get the gain. Divide the gain by the value. That's the share that counts.
- For each possible source, multiply the cash by its share that counts. Write the MAGI added.
- Add the MAGI added to your MAGI before the cash. Do it once for each source.
- Subtract each new MAGI from your IRMAA line. A positive number is room left. A negative number means you'd be over.
- Pick the source that keeps you under the line with the most room, while keeping some Roth and taxable money for later years.
Check your answer
- MAGI added from a taxable account can never be more than the cash you take. If it is, you divided value by gain instead of gain by value.
- For George and Ellen: $213,500 + $4,500 = $218,000. The new MAGI plus the room should always equal the line.
- If your fund is worth less than you paid, the gain share is zero or negative. Selling adds nothing to MAGI, and the loss may lower it. Ask your tax preparer.
Figures this worksheet uses, and where they come from: The 2026 IRMAA income lines used in the examples: $109,000 on an individual return, $218,000 on a joint return (SSA, Premiums: Rules for Higher-Income Beneficiaries); A qualified charitable distribution (QCD) counts toward an RMD and is not counted in income (IRS, Publication 590-B).