Many of you may not be aware of the new “Medicare Surtax” that will be noticed this tax season by several thresholds of individuals. This tax is 3.8% and is dependent on two numbers: the taxpayer’s net investment income (NII) and the taxpayer’s modified adjusted gross income (MAGI). The tax is applied on the lower of the two numbers, which means that people with low investment income will pay less.
Medicare Surtax – Thresholds
- $250,000 for married couples filing jointly
- $125,000 for married couples filing separately
- $200,000 for everyone else
How does the Medicare Surtax Work?
A quick example of how the Medicare Surtax works: John Doe earned $150,000 last year and had $75,000 of net investment income. The adjusted gross income correlates to $225,000 (total earned and investment income). Mr. Doe since he is single has a $200,000 threshold. So the MAGI after being reduced is $25,000 ($225,000 minus $220,000). So he will receive a tax bill of $950 which is $25,000 times 3.8% Medicare Surtax.
Most people across the country will not have to worry about this tax. Someone reading this article right now is thinking, “Man I would love to have that problem.” This is something that everyone should be made aware of so they can plan accordingly.
Offering Supplemental Medicare plans – Medigap and Dental Insurance
If you need help understanding about Medicare, Medicare Supplements or the taxes associated with Medicare email us at email@example.com or call us at 1-877-936-2991. We look forward to working with you and helping you decipher the Medicare system.
For a free trial of the new and improved Medicare Supplement Quote Engine visit Medicare Insurance Finders homepage for a quick trial. In less than 2 minutes you can search over 30 different insurance companies in your own zip code.
The President recently allocated a large portion of his budget to Medicare and the Medicare Supplement Taxes. The plan is to increase the cost of certain Medigap policies to reduce the amount of people who want to pay for first dollar coverage. Certain members of Congress who have tried to get this passed for several years are pleased that it slipped into the President’s proposal for the budget.
Medicare Supplement Taxes – Why?
Most people wonder, “Why would you impose a Medicare Supplement tax on seniors who are trying to purchase insurance policies to fill in the gaps of Original Medicare?” The reason the government is pushing this is because they feel first dollar coverage causes more people to go to the doctor for any minor thing. This may be true for some. On the other side of the coin, people who do not have first dollar coverage and don’t go to the doctor or hospital may have more acute conditions that end up being more costly in the long run.
The Medicare Supplement Tax will amount to 15% of the average Medicare Supplement Premium, which equates to 30% of the Part B Premium.
What are my options?
There are several options to avoid this Medicare Supplement Tax.
- Enroll in a Plan G instead of a Plan F. First of all the premiums are lower. Secondly, the only difference between a Plan F and G is that the Part B deductible ($147 – 2014) is missing. There is a good chance the tax will be more than the $147 deductible.
- Enroll in the BAI group medical plan that mimics the Plan F Medicare Supplement. It does not ask health questions. Plus, it avoids the surcharge tax. This means that your premium will be an average of 15% less than the standardized Medicare Supplement. To enroll in this plan you can call 1-877-936-2991.
Choosing a Medicare Supplement is more complicated than it was 10 years ago. Now you are required to enroll in a Part D plan. You have to check the stability of the carrier you are enrolling in to make sure they are not going to give you a low rate the first year, then raise the rates by 16% the second year. Also, be aware of a potential Medicare Supplement Tax. Call us at 1-877-936-2991 with any Medicare Supplement related questions.
Hassle Free Rate Comparison
Wisconsin is one of the three states across the country that does not have Standardized Medicare Supplement Plans. However, we still provide Wisconsin Medicare Supplement rates online for plan “F” and plan “G”. Understand since these plans are not standardized in WI that they are not called Plan F or Plan G but adding the different pieces together gets you the same coverage.
Why would I want a Plan F or Plan G in Wisconsin?
The reason the Plan F and Plan G are quoted on our quote engine for your state is because these are the two most popular Medigap policies across the country. The state of Wisconsin offers these plans but has not adopted the standardized names as 47 other states across the country have.
Plan F provides the most benefit rich coverage – which means that basically it picks up all the deductibles, coinsurance and co-pays that you are left to pay after Medicare pays its share. Click here for more information on Plan F coverage. However, those that don’t have to have the top of the line coverage often opt for the Plan G. This plan does not cover the Part B deductible which is under $150 a year, but it offers more savings on premium as well as a lower rate increase history. This is big for seniors living on a budget wanting to keep their costs down.
Wisconsin Medicare Supplement Rates
Wisconsin’s Medigap plans provide stable coverage which can not be said about Medicare Advantage Plans. Medigap policies provide you with the same coverage year after year as well as the flexibility to see any doctor that accepts Medicare. Below is an example of what our quote engine offers for Wisconsin Medicare Supplement Rates. Aetna, United Healthcare Continental Life, Mutual of Omaha, Humana and many other insurance companies offer these plans in your state and our dedicated support staff is standing by to help advice you on how to choose a plan.
Here is an example of the Wisconsin Medicare Supplement Rates shown in our quote engine.
Call us today (1-877-936-2991) for your personalized Wisconsin Medicare Supplement Plan or visit us on the web for your own quote at www.medicareinsurancefinders.com.