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Medigap vs. Medicare Advantage: What to Know in 2026

When you become eligible for Medicare, an important step is deciding how you want to manage out-of-pocket costs that are not fully covered by Original Medicare (Parts A & B). In 2026, the two main pathways people evaluate are:

  • Medigap (Medicare Supplement Insurance) – works with Original Medicare.
  • Medicare Advantage (Part C) – an alternative way to receive Medicare benefits through a private plan.

Both options function differently, and both come with unique structures and considerations. This guide explains the differences in a neutral, educational format.

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A 2026 Educational Overview Provided by Policy Engineer Insurance Solutions
For informational and educational purposes only. This material is not intended to influence your enrollment decisions. Individuals should review all options available in their area through Medicare.gov or consult a licensed insurance professional for personalized guidance.

Understanding Your Choices in 2026

When you become eligible for Medicare, an important step is deciding how you want to manage out-of-pocket costs that are not fully covered by Original Medicare (Parts A & B). In 2026, the two main pathways people evaluate are:

  • Medigap (Medicare Supplement Insurance) – works with Original Medicare.
  • Medicare Advantage (Part C) – an alternative way to receive Medicare benefits through a private plan.

Both options function differently, and both come with unique structures and considerations. This guide explains the differences in a neutral, educational format.

Review Your Medicare Plan

What Are Medigap and Medicare Advantage?

Medigap (Medicare Supplement Insurance)

  • Medigap policies are offered by private insurance companies and help pay certain out-of-pocket costs under Original Medicare, such as coinsurance, copayments, and deductibles.
  • In most states, Medigap plans are standardized by letter (A, B, C … N). A plan with the same letter offers the same core benefits regardless of the insurer.
  • Medigap does not include prescription drug coverage, so individuals generally need a separate Part D plan if they want drug coverage.

Medicare Advantage (Part C)

  • Medicare Advantage plans are offered by Medicare-approved private companies. These plans provide Medicare Part A and Part B benefits through a bundled plan.
  • Many plans also include Part D prescription drug coverage and may offer additional benefits such as dental, vision, or hearing services.
  • Medicare Advantage plans include an annual maximum out-of-pocket limit (MOOP) for Medicare-covered services.
  • These plans typically use provider networks, which may affect access to certain doctors and hospitals depending on the plan type.
  •  

  • Key Differences Between Medigap and Medicare Advantage in 2026

    1. Cost Structure

    Medigap

    • Requires a monthly premium.
    • Offers more predictable out-of-pocket costs when receiving Medicare-covered care.
    • Depending on the selected plan, Medigap may cover certain Medicare deductibles, coinsurance, or copayments.

    Medicare Advantage

    • Monthly premiums vary by plan.
    • Individuals generally pay copayments or coinsurance when receiving services.
    • Plans include an annual out-of-pocket maximum for Medicare-covered services under Part A and Part B.

    2. Provider Access

    Medigap

    • Allows access to any doctor or specialist in the United States who accepts Medicare.
    • No networks or referrals are required.

    Medicare Advantage

    • Most plans have networks such as HMOs or PPOs.
    • Out-of-network coverage depends on the plan and may result in different costs or limitations.

    3. Predictability vs. Variability of Costs

    Medigap

    • Provides stable, predictable cost-sharing, which may be helpful for individuals who expect frequent medical use.

    Medicare Advantage

    • Costs can vary depending on how often services are used.
    • Once the plan’s out-of-pocket maximum is reached, Medicare-covered services are generally covered by the plan for the remainder of the year.

    4. Prescription Drug Coverage

    Medigap

    • Does not include prescription drug coverage.
    • A separate Part D plan is typically needed for medications.

    Medicare Advantage

    • Many plans include Part D prescription drug coverage within the plan.

    5. Stability and Yearly Changes

    Medigap

    • Benefits are standardized and typically do not change from year to year.
    • Premiums may adjust over time.

    Medicare Advantage

    • Plan benefits, drug formularies, network structures, and cost-sharing may change annually.
    • Members receive an Annual Notice of Change (ANOC) each fall that outlines upcoming changes.

    6. Enrollment and Underwriting Rules

    Medigap

    • When you enroll in Medicare Part B for the first time, you receive a six-month Medigap Open Enrollment Period where you have guaranteed-issue rights.
    • During this period, you cannot be denied a Medigap plan based on health status.
    • Outside of this window, applying for certain Medigap plans may require medical underwriting in many states.

    Switching From Medicare Advantage to Medigap

    • Switching may require underwriting unless you qualify for a specific guaranteed-issue situation, such as certain trial rights or special circumstances.

Questions to Consider When Comparing Options

To help understand which structure may align with your preferences, consider:

  • How often do I visit doctors or specialists?
  • Do I prefer unrestricted provider access, or am I comfortable with a network?
  • How important is predictable monthly spending?
  • Do I want prescription drug coverage included in the same plan?
  • What is my budget for monthly premiums?
  • Could my healthcare needs change in the future?
Questions?

Tips for Reviewing Options in 2026

  • Review your Medicare Advantage plan’s Annual Notice of Change (ANOC) each fall if you are already enrolled.
  • Compare Medigap, Medicare Advantage, and Part D plans using the Medicare Plan Finder at Medicare.gov.
  • Reach out to your State Health Insurance Assistance Program (SHIP) for free and unbiased Medicare guidance.
  • If considering Medigap outside the guaranteed-issue window, review underwriting rules in your state.
  • If selecting Medigap, review Part D drug plan options separately.
  • Estimate your potential annual costs under both structures—consider typical use and potential high-use years.
Review Your Strategy

Educational Disclaimer

This article is intended for education only and should not be used to determine enrollment, plan selection, or plan comparison.
Medicare Advantage and Part D plans vary by county and service area. Individuals should verify plan details through Medicare.gov, the plan’s official documents, and licensed professionals when making Medicare decisions.

 
 
 
 

Understanding Medicare PPO Plans in 2026: A Comprehensive Guide

Navigating Medicare can feel overwhelming — especially when you’re faced with multiple plan types and ever-changing policies. One option that continues to resonate with many beneficiaries is the Medicare Advantage PPO (Preferred Provider Organization) plan. In 2026, there are significant trends, changes, and trade-offs worth understanding. This guide breaks it all down.

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A Purely Educational Overview of Key 2026 Changes Published by Policy Engineer Insurance Solutions — For Informational Purposes Only  At Policy Engineer Insurance Solutions, our goal is to help you understand these changes from an educational standpoint so you can plan with clarity.

1. What Is a Medicare PPO Plan?

  • Medicare Advantage (Part C): PPO plans are a type of Medicare Advantage plan. These are private insurer-run plans that bundle Medicare Part A (hospital) and Part B (medical), and often Part D (prescription drugs).

  • Flexibility: Unlike HMO (Health Maintenance Organization) plans, PPOs typically allow you to see both in-network and out-of-network providers. You don’t always need referrals to see a specialist. This gives more freedom, but it may come at a higher cost when using out-of-network providers.

  • Cost Structure: Costs may include monthly premiums, co-pays, or coinsurance for services, and in some cases, out-of-pocket maximums. The exact terms vary by plan.

Review Your Medicare Plan

2. What’s Changing for Medicare PPOs in 2026?

There are several key shifts in the Medicare Advantage (MA) market relevant to PPO plans in 2026. These influence cost, availability, and program design.

a) Overall Stability with Some Premium Declines
CMS projects that average Medicare Advantage premiums will decrease slightly in 2026.

  • The projected average monthly premium for MA across all types (including PPOs) is estimated to drop from $16.40 in 2025 to $14.00 in 2026.

  • This suggests that, for many beneficiaries, Medicare Advantage remains a cost-competitive alternative.

b) Policy & Technical Updates
New rulemaking and policy adjustments are being implemented for 2026:

  • CMS’s 2026 final rule for Medicare Advantage includes updates related to Part D, Star Ratings, and how supplemental benefits are structured.

  • These changes may affect coverage, network design, and out-of-pocket responsibilities.

c) PPO Plan Reductions
The Medicare Advantage landscape is evolving:

  • According to industry analysis, PPO offerings are shrinking, with more PPO plans being phased out compared to HMOs. 

  • Specifically, many of the discontinued PPOs are “$0-premium” PPO MA-PD plans, reducing options for beneficiaries seeking low-premium PPOs.

  • Insurers may be cutting these PPOs due to cost risk: Wide provider networks make it harder to control expenses compared to tighter HMO networks. 

d) Quality Ratings Still Matter

  • CMS assigns Star Ratings to Medicare Advantage plans based on quality measures (e.g., access to care, patient satisfaction, management of chronic conditions). (CMS)

  • These ratings affect both beneficiary decision-making and how much insurers are paid. In 2026, these quality ratings continue to play a significant role.

e) Cost-Sharing Adjustments for Dual-Eligible PPOs

  • Proposed changes include limits on out-of-network cost sharing for PPOs designed for dual-eligible individuals (those eligible for both Medicare and Medicaid). (CMS)

  • These adjustments aim to make PPOs safer and more predictable for vulnerable populations.

f) Plan Exit Risk

  • Some major insurers are pulling back on PPO offerings; for example, reports indicate that UnitedHealth will discontinue over 100 Medicare Advantage plans by 2026, including many PPOs. 

  • For beneficiaries, this means potential disruption: if your PPO is discontinued, you may need to choose a new plan or switch to another type. of plan

3. Pros and Cons of Choosing a PPO in 2026

Advantages:

  1. Provider Flexibility: Ability to see out-of-network doctors.

  2. No Referral Needed: In many PPO plans, you can see specialists without a referral.

  3. Predictable Upper Costs: Many PPOs have an annual maximum out-of-pocket limit, helping protect against very high costs.

  4. Suitable for Travelers: If you split time between places (e.g., “snowbirds”), a PPO’s flexibility can be beneficial.

Disadvantages:

  1. Fewer Options: With fewer PPO plans, your local choices may be more limited.

  2. Potential for Higher Costs: Using out-of-network providers generally results in higher costs.

  3. Financial Risk for Insurers: Because of this risk, some insurers are reducing or discontinuing PPOs, which may lead to less competition.

  4. Plan Complexity: Each PPO plan’s structure (premium, co-pays, out-of-pocket max, drug coverage) can vary widely, so it’s critical to compare carefully.

4. Real-World Examples: What Some PPOs Look Like in 2026

  • Johns Hopkins Advantage MD – 2026 PPO:

    • $95/month premium

    • No medical deductible

    • $5 PCP copay, $45 specialist copay

    • Telehealth is $0 copay in-network. Johns Hopkins Advantage MD

  • Johns Hopkins Advantage MD – 2026 “Plus” PPO:

    • $155/month premium

    • No medical deductible

    • $0 copay for primary care, $40 for specialists

    • Emergency copay: $110 (waived if hospitalized) Johns Hopkins Advantage MD

  • Blue Medicare Advantage Valor PPO:

    • Their 2026 Annual Notice of Change shows adjustments in various cost-sharing categories (e.g., skilled nursing facility copay differences, in- vs out-of-network) that beneficiaries must carefully review. digital-assets.wellmark

Questions?

5. Should You Choose a PPO Plan in 2026?

Here are some guiding questions to help you decide:

  1. Are your preferred doctors in-network?
    Even though PPOs allow out-of-network visits, staying in-network is usually cheaper.

  2. Do you travel or split time between locations?
    If you’re not always in one place, PPO flexibility may save you in the long run.

  3. How much care do you expect to use?
    If you see specialists often or need more complex care, PPOs might offer better access. But if most of your care is routine, a tighter HMO could be more cost-effective.

  4. What is your risk tolerance?
    Consider worst-case scenarios for out-of-pocket costs. Check the maximum out-of-pocket in your plan.

  5. Have you checked the plan’s 2026 changes?
    Look at each plan’s Annual Notice of Change (ANOC) for 2026. Insurer changes, cost-sharing, network updates, and benefit tweaks can significantly affect your year-to-year costs.

  6. How do the quality ratings look?
    Use CMS’s Star Ratings when comparing plans — higher-rated plans may provide better value or care.

 

Review Your Strategy

6. Tips for the 2026 Enrollment Period

  • Use Medicare Plan Finder: By October 1, 2025, the tool should reflect 2026 plan options. CMS

  • Review Notices: Carefully read the Annual Notice of Change from your plan(s).

  • Ask for Help: Call 1-800-MEDICARE or work with a licensed agent who understands Medicare Advantage.

  • Compare Total Cost, not just premium: Include premiums, copays, coinsurance, and the worst-case out-of-pocket.

  • Consider Long-Term Needs: If your health needs may change, consider whether network flexibility or a lower out-of-pocket risk is more important to you.

Understanding Medicare Parts A & B Changes for 2026

Medicare is not static; each year, the premiums, deductibles, and cost-sharing structures can change. In November 2025, the CMS released updated figures for 2026, so it’s crucial for beneficiaries to stay informed about these changes.
 

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What are Parts A and B?

What’s New for Medicare in 2026?

Why These Changes?

What This Means For Your

Steps To Take

Schedule Your Medicare Review

A Purely Educational Overview of Key 2026 Changes Published by Policy Engineer Insurance Solutions — For Informational Purposes Only  At Policy Engineer Insurance Solutions, our goal is to help you understand these changes from an educational standpoint so you can plan with clarity.

What are Parts A and B?

  • Part A (Hospital Insurance): Covers inpatient hospital stays, skilled nursing facility care, hospice, and some home health services. 

  • Part B (Medical Insurance): Covers outpatient care, physician services, preventive services, durable medical equipment, and certain other services not covered under Part A

Review Your Medicare Plan

Key Changes for 2026

Part A: Premiums & Deductibles

  • The inpatient hospital deductible for 2026 will be $1,736, up from $1,676 in 2025—an increase of $60.

  • Hospital daily coinsurance amounts:

    • For days 61-90 of a hospitalization benefit period: $434/day (up from $419).

    • For lifetime reserve days: $868/day (up from $838).

  • Skilled nursing facility daily coinsurance for days 21-100: $217 (up from $209.50). CMS

  • Part A monthly premium for those who must pay (because they have fewer than the required quarters):

    • Reduced monthly premium (for those with at least 30 but fewer than 40 quarters): $311 in 2026 (up $26).

    • Full premium (fewer than 30 quarters): $565 in 2026 (up $47).

Part B: Premiums & Deductibles

  • Standard monthly premium for Part B: $202.90 for 2026, up from $185.00 in 2025 (an increase of $17.90).

  • Annual deductible for Part B: $283 in 2026, up from $257 in 2025 (increase of $26).

  • For individuals with kidney transplants who use immunosuppressive drugs and continue Part B coverage, the premium is $121.60.

Income-Related Monthly Adjustment Amounts (IRMAA)

  • Part B and Part D premiums can increase further for high-income beneficiaries based on their modified adjusted gross income (MAGI). CMS

  • For example, for full Part B coverage in 2026:

    • Individuals with MAGI ≤ $109,000 (or joint ≤ $218,000): pay standard premium ($202.90).

    • Individuals with MAGI > $109k ≤ $137k (joint > $218k ≤ $274k): pay an additional $81.20, making the total monthly premium $284.10.

    • And for higher income levels: totals rise to $405.80, $527.50, $649.20, depending on MAGI bracket.

Visit to CMS.com for more info
Chris Farmer of 2026_Integral Benefits Group_Agency Engineer Medicare 101Understanding Your Medicare Plan Options

Part B & D – Premium Costs

How Does Medicare Calculate Part B Part D Premiums?
• To determine your Medicare premiums for a specific year, Medicare examines your income from the tax return submitted two years prior.
• This means that for 2026 premiums, your 2024 tax return will be used.

Medicare uses your Modified Adjusted Gross Income (MAGI) to determine your premiums.
• MAGI includes your Adjusted Gross Income (AGI) and tax-exempt interest income.
• Medicare uses income tiers, which determine your premium based on your MAGI.
• Investment income types used to calculate Medicare premiums include interest, dividends, capital gains, rental income, and tax-exempt interest.

Why These Changes?

According to CMS, the increases reflect:

  • Projected price changes (costs of medical services, hospital stays, etc.). CMS

  • Forecasted utilization increases (beneficiaries using more services or costlier services). CMS

  • For Part B: Without certain policy interventions (e.g., changes to skin substitute spending), the premium would have been about $11 higher/month. CMS

What This Means for You

  • Even modest increases in premiums and deductibles can impact annual healthcare budgeting. If you’re used to $185/month for Part B, you’ll now plan for $202.90/month (before IRMAA).

  • If you travel, switch plans, or see many specialists, higher cost-sharing (deductibles, coinsurance) may come into play—so evaluate overall cost, not just the premium.

  • High-income beneficiaries should especially review IRMAA brackets, as cost increases can be sizeable.

  • If you expect heavy utilization (e.g., long hospital stay), increases in hospital deductibles and daily coinsurance for extended stays matter — make sure you understand how far your coverage carries you.

  • Consider revisiting your healthcare coverage decisions, supplemental insurance (Medigap), Medicare Advantage plans, or other out-of-pocket coverage strategies in light of these updated numbers

Questions?

Action Steps to Take

  1. Review your current Medicare coverage: Are you on Original Medicare (Parts A & B)? Are you considering switching to a Medicare Advantage or adding a Medigap policy?

  2. Update your healthcare budget: Move from $185 to $202.90 for the standard Part B premium; adjust for potential IRMAA if applicable.

  3. Check for supplemental coverage: If you anticipate deductibles or coinsurance will be significant, see whether a Medigap plan or Advantage plan with better cost-sharing makes sense.

  4. Be mindful of income changes: If your income has changed significantly (for self-employment, investment income, etc.), you may fall into a different IRMAA bracket.

  5. Mark key dates: Typically, Medicare annual enrollment and plan changes coincide with end-of-year windows. Stay alert for communications from CMS and your plan.

  6. Ask questions: If you’re unclear about how these changes affect you, reach out to Medicare.gov, your local State Health Insurance Assistance Program (SHIP), or a trusted advisor.

Review Your Strategy

The 2026 updates to Medicare’s premiums and deductibles may not represent dramatic shifts, but they are meaningful. An increase of roughly $18/month for Part B and higher deductibles and coinsurance under Part A means that for many beneficiaries, out-of-pocket planning needs to adjust. Coupled with the income-related premium surcharges, it’s more important than ever to review your Medicare strategy proactively and ensure that your coverage meets your health, financial, and lifestyle needs.

Last Updated: December 1st, 2025

Understanding IRMAA 2026: How Your Income Affects Medicare Premiums

Medicare’s base premiums are only part of what some beneficiaries pay. For those with higher income, an extra surcharge called IRMAA (Income-Related Monthly Adjustment Amount) raises your costs for Part B and Part D. That surcharge is determined by your Modified Adjusted Gross Income (MAGI) from two years prior. In 2026, your 2024 tax return will be the basis. Knowing where the 2026 IRMAA brackets may land—and taking steps now—can make a difference.

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What Is IRMAA?

IRMAA — or Income-Related Monthly Adjustment Amount — is an extra amount that certain Medicare beneficiaries pay on top of their standard Medicare Part B and Part D premiums.
It ensures that higher-income individuals contribute more toward the Medicare program.

IRMAA uses a tiered system with income thresholds that determine how much extra you’ll pay.

IRMAA — Quick Refresher

  • It’s a surcharge added to Medicare Part B and (if applicable) Part D premiums.
  • Only applies if your income (MAGI) exceeds a set threshold.
  • Due to the two-year look-back rule, your 2024 income determines your 2026 IRMAA level.
  • IRMAA uses “cliffs” — even $1 over a threshold can move you into a higher tier.

How IRMAA Impacts Your Premiums

Standard Medicare Part B and D premiums are fixed for most beneficiaries, but IRMAA can add significant costs depending on your income bracket.

2026 Premium Changes

Metric 2025 Baseline 2026
Standard Part B premium $185.00 $202.90
Part B annual deductible $257 $283
IRMAA surcharges (Part B) $74.00 → $443.90 $81.20 → $487.00
IRMAA surcharges (Part D) Varies by income $14.50 → $91.00
Filing Status No IRMAA 1st Tier 2nd Tier 3rd Tier 4th Tier 5th Tier
Single ≤ $109,000 $109,001–$137,000 $137,001–$171,000 $171,001–$205,000 $205,001–$500,000 $500,001+
Married (Joint) ≤ $218,000 $218,001–$274,000 $274,001–$342,000 $342,001–$410,000 $410,001–$750,000 $750,001+

2026 Total Monthly Part B Premiums (Including IRMAA)

  • No surcharge: $202.90
  • Tier 1: $284.10
  • Tier 2: $405.80
  • Tier 3: $527.50
  • Tier 4: $649.20
  • Tier 5: $689.90

2026 IRMAA Surcharges for Part D

  • No surcharge: $0.00
  • Tier 1: $14.50
  • Tier 2: $37.50
  • Tier 3: $60.40
  • Tier 4: $83.30
  • Tier 5: $91.00

Additional Notes

  • Your 2024 income determines your 2026 IRMAA level.
  • The first four income brackets are indexed for inflation; the top bracket is frozen until 2028.
  • If your income has decreased due to a major life event (like retirement or divorce), you may request a reconsideration using Form SSA-44.

Key Takeaways

  • The standard Part B premium will rise to $202.90/month.

  • IRMAA surcharges could range from $81.20 to $487/month, depending on your income.

  • Your 2024 income is the key driver of your 2026 IRMAA tier.

IRMAA Brackets

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Table 1: 2026 Medicare Part B Premiums (including IRMAA)

Filing Status MAGI Bracket IRMAA Surcharge Total Monthly Premium
Single / Individual ≤ $109,000 $0.00 $202.90
Single / Individual $109,001 – $137,000 $81.20 $284.10
Single / Individual $137,001 – $171,000 $202.90 $405.80
Single / Individual $171,001 – $205,000 $324.60 $527.50
Single / Individual $205,001 – $499,999 $446.30 $649.20
Single / Individual ≥ $500,000 $487.00 $689.90
Married (Joint) ≤ $218,000 $0.00 $202.90
Married (Joint) $218,001 – $274,000 $81.20 $284.10
Married (Joint) $274,001 – $342,000 $202.90 $405.80
Married (Joint) $342,001 – $410,000 $324.60 $527.50
Married (Joint) $410,001 – $749,999 $446.30 $649.20
Married (Joint) ≥ $750,000 $487.00 $689.90

 

 

Table 2: 2026 Medicare Part D IRMAA Surcharges

Filing Status MAGI Bracket IRMAA Surcharge (Monthly)
Single / Individual ≤ $109,000 $0.00
Single / Individual $109,001 – $137,000 $14.50
Single / Individual $137,001 – $171,000 $37.50
Single / Individual $171,001 – $205,000 $60.40
Single / Individual $205,001 – $499,999 $83.30
Single / Individual ≥ $500,000 $91.00
Married (Joint) ≤ $218,000 $0.00
Married (Joint) $218,001 – $274,000 $14.50
Married (Joint) $274,001 – $342,000 $37.50
Married (Joint) $342,001 – $410,000 $60.40
Married (Joint) $410,001 – $749,999 $83.30
Married (Joint) ≥ $750,000 $91.00
 
How Is IRMAA Calculated?

IRMAA is based on your Modified Adjusted Gross Income (MAGI) from two years prior.
For example, if you’re paying IRMAA in 2026, the Social Security Administration (SSA) and IRS use your 2024 MAGI to determine your premium.

How to lower your IRMAA

There are a few things you can do to lower your IRMAA, such as:

    • Reducing your MAGI. This can be done by contributing to a retirement plan, making charitable donations. you can deduct up to $300 of charitable donations from your MAGI each year.
    • Take advantage of tax credits and deductions. There are a number of tax credits and deductions that can help you reduce your taxable income, which can lower your MAGI.
    • Enrolling in a Medicare Advantage plan with no IRMAA. Some Medicare Advantage plans do not charge an additional premium for people who are subject to IRMAA.
    • Appealing your IRMAA determination. You can appeal your IRMAA determination if you believe it is incorrect. You will need to submit the SSA-44 form to the Social Security Administration.
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Life Events 

Life events that may impact your IRMAA

IRMAA Appeals

While IRMAA is typically unavoidable if your income falls within the specified thresholds, certain life events can lead to significant changes in your income. In these cases, you may have the opportunity to appeal the IRMAA determination through the “Medicare Income-Related Monthly Adjustment Amount – Life-Changing Event” (SSA-44) form.

If any of the life events mentioned above apply to you, you have the option to submit the SSA-44 form to the Social Security Administration. Include evidence of the life-changing event and provide an estimate of your reduced income. It’s essential to know that each appeal is evaluated on a case-by-case basis, and there’s no guarantee of a successful outcome.

The appeal process is two-tiered. First, you will file an informal appeal with the Social Security Administration (SSA). If the SSA does not uphold your appeal, you can then file a formal appeal with the Medicare Appeals Council.

The SSA will consider the following factors when evaluating your appeal:

  • The accuracy of your MAGI
  • Whether there were any errors in the calculation of your IRMAA
  • Whether there were any changes in your income or circumstances that would warrant a reduction in your IRMAA

If you are successful in your appeal, the SSA will recalculate your IRMAA and send you a new determination letter.

Here are some tips for appealing an IRMAA determination:

  • Be sure to file your appeal within the 60-day deadline.
  • Gather all of the documentation that supports your appeal, such as tax returns, income statements, and any other evidence that shows that your MAGI has changed.
  • Be clear and concise in your appeal letter. Explain why you believe the SSA’s determination is incorrect and why you deserve a reduction in your IRMAA.
  • If you are not comfortable writing your own appeal letter, you can hire an attorney or a representative to help you. 
pexels-medinegurbet-21435626-13845034
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Strategies to Reduce Medicare IRMAA

No one wants to deal with unexpected premium hikes because of IRMAA. Although many people face an IRMAA when they first sign up for Medicare, factors like retirement income can help reduce or even get rid of this extra expense. Some Medicare beneficiaries may initially qualify for benefits below the IRMAA threshold, but their income may increase as they age.

Let’s explore some effective strategies to help you minimize your susceptibility to IRMAA increases and maintain a stable financial outlook in your retirement years.

  • Use tax-deferred accounts.

    If you have a taxable investment account, consider moving some of your money into a tax-deferred account, such as a 401(k) or IRA. This strategy allows you to postpone reporting capital gains and dividends until you withdraw the funds, which can lower your MAGI (Modified Adjusted Gross Income).

    For example, if you have $100,000 in a taxable investment account and make a $10,000 withdrawal, you would need to report the $10,000 of capital gains on your tax return. However, if you move that $10,000 into a tax-deferred account, you won’t have to report the capital gains until you withdraw the money in retirement. This approach could save you hundreds or even thousands of dollars in Medicare IRMAA over the years by reducing your MAGI and potentially lowering your Medicare premiums.

  • Maximize your retirement account contributions.

    If you are still working, you can contribute up to $23,000 to your 401(k) or $7,000 to your IRA in 2025. These contributions are deducted from your income before it is calculated for Medicare IRMAA, which can significantly reduce your MAGI (Modified Adjusted Gross Income).

    For example, if you make the maximum contribution to your 401(k), your MAGI will be $23,000 lower than it would be without the contribution. This reduction could save you hundreds of dollars in Medicare IRMAA surcharges by potentially keeping you in a lower income bracket.

  • Consider using Qualified Longevity Annuity Contracts (QLACs).

    QLACs are a type of annuity that allows you to delay Required Minimum Distributions (RMDs) until age 85. Since RMDs are calculated based on your account balance at the end of the year, delaying them means you can also delay the income that is included in your MAGI (Modified Adjusted Gross Income).

    For example, if you have a $1 million IRA and are required to take an RMD of $50,000 in 2025, that $50,000 would be included in your MAGI for the year. However, by using a QLAC to delay your RMDs until age 85, you won’t need to include that $50,000 in your MAGI until 2045. This strategy could save you thousands of dollars in Medicare IRMAA surcharges over the years by keeping your income in a lower bracket.

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Here are a few additional things to keep in mind.
 
  • Dual Eligibility and IRMAA: It’s essential to note that individuals who are dually eligible for both Medicare and Medicaid are usually exempt from paying Part B premiums and, by extension, IRMAA. Medicaid coverage typically takes care of these costs, providing much-needed relief for those with limited financial resources.
  • IRMAA Notifications: Beneficiaries subject to IRMAA will receive notifications from the Social Security Administration. These notifications outline the extra premium amount due to IRMAA and provide details on how to make the payment. Make sure to read and respond to these notices promptly to avoid any interruptions in coverage.
  • IRMAA for Late Enrollees: For those who enroll in Medicare Part B or Part D after turning 65, the initial IRMAA determination might be based on their current year’s income. This adjustment accounts for late enrollees and ensures a fair calculation that aligns with their actual financial situation.
  • IRMAA and Part C (Medicare Advantage): While IRMAA affects Part B and Part D premiums, it doesn’t extend to Medicare Advantage (Part C) plans. However, it’s crucial to understand that even if your Medicare Advantage plan covers your Part B premium, you must continue paying it separately to avoid IRMAA implications.
  • Annual Income Review: Remember that your income is reviewed annually for IRMAA purposes. Even if you haven’t experienced a life-changing event, changes in your income could lead to adjustments in future IRMAA determinations.
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Frequently Asked Questions

  1. What is IRMAA? IRMAA stands for Income-Related Monthly Adjustment Amount. It’s an additional premium that some Medicare beneficiaries with higher incomes have to pay on top of their regular Medicare Part B and Part D premiums.

  2. How is IRMAA calculated? IRMAA is calculated based on your Modified Adjusted Gross Income (MAGI) from two years prior. The higher your MAGI, the more you may have to pay for IRMAA.

  3. What income is considered for IRMAA calculations? The income considered for IRMAA calculations includes your adjusted gross income, tax-exempt interest, and other tax-exempt income.

  4. What are the income thresholds for IRMAA? The income thresholds for IRMAA vary depending on whether you’re an individual or a joint filer (married). Different income ranges correspond to different levels of IRMAA.

  5. When do I have to pay IRMAA? IRMAA is typically added to your Medicare premium if your income exceeds the specified thresholds. You’ll pay this additional amount alongside your regular Part B and Part D premiums.

  6. Can my IRMAA change from year to year? Yes, your IRMAA can change from year to year based on your income. The Social Security Administration reviews your tax return information periodically to determine any changes in your IRMAA status.

  7. How do I know if I need to pay IRMAA? You’ll receive a notice from the Social Security Administration if you need to pay IRMAA. This notice will detail the amount you need to pay and how to pay it.

  8. Is IRMAA the same for Medicare Part B and Part D? No, IRMAA applies separately to Medicare Part B and Part D. Your income will be evaluated for each of these parts independently.

  9. What happens if my income changes during the year? Your IRMAA is based on your income from two years prior. If your current income is significantly lower due to certain life events, you might be able to appeal your IRMAA determination.

  10. Can I appeal an IRMAA determination if I experience a life-changing event? Yes, you can appeal an IRMAA determination if you experience certain life events, such as marriage, divorce, or retirement, that result in a significant income change.

  11. What are considered “life-changing events” for IRMAA appeals? Life-changing events that might warrant an IRMAA appeal include marriage, divorce, annulment, death of a spouse, retirement, reduced work hours, loss of income-producing property, pension plan changes, and settlements from employers.

  12. How do I submit an appeal for IRMAA? To appeal an IRMAA determination, you can submit the “Medicare Income-Related Monthly Adjustment Amount – Life-Changing Event” (SSA-44) form to the Social Security Administration along with evidence of the life-changing event and an estimate of your reduced income.

  13. Is there a deadline for appealing an IRMAA determination? You must file your appeal within 60 days of the date of the determination letter. If you miss the deadline, you may still be able to appeal, but your chances of success are lower, it’s recommended to submit your appeal as soon as possible after experiencing a qualifying life-changing event.

  14. How long does it take to hear back about an IRMAA appeal? The processing time for IRMAA appeals can vary, but you should receive a response from the Social Security Administration once they review your appeal.

  15. Can I reduce my income to avoid paying IRMAA? While it’s not advisable to make financial decisions solely to avoid IRMAA, certain life events like retirement might naturally reduce your income.

  16. What documentation do I need to provide for an IRMAA appeal? You’ll need to provide evidence of the life-changing event that caused the income change, along with an estimate of your reduced income. Supporting documents might include marriage or divorce certificates, retirement notices, or other relevant paperwork.

  17. Can I avoid IRMAA by changing my investment strategies? Changing investment strategies solely to reduce your income for IRMAA purposes may not be practical or advisable. It’s essential to consider your overall financial goals.

  18. Are there any programs to help with paying IRMAA for individuals with financial difficulties? There are assistance programs available for individuals with limited income and resources. You can explore programs like Medicare Savings Programs (MSPs) that might help cover IRMAA costs.

  19. Does IRMAA apply to all Medicare beneficiaries? No, IRMAA only applies to Medicare beneficiaries whose income exceeds specific thresholds.

  20. What happens if I don’t pay my IRMAA premium? If you’re required to pay IRMAA and you don’t, your Medicare coverage might be affected. It’s crucial to fulfill your premium obligations to maintain uninterrupted coverage.

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Last Updated: September 15th, 2025

Medicare Costs Are Rising in 2026: What You Should Know

Medicare is changing in 2026 — and many of those changes could mean higher costs for beneficiaries. Premiums, deductibles, and prescription drug expenses are all set to increase. Understanding how much is expected to go up can help you plan better.

This blog is for educational purposes only and does not constitute financial, tax, or legal advice. You should consult with a qualified financial and tax professional before making any decisions regarding financial products, tax filings, or deductions to determine what is appropriate for your specific situation.

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What’s Expected to Change in 2026 (Projected Figures)

Based on the latest Medicare Trustees’ Report, CMS announcements, and other trusted sources. Final amounts will be confirmed in fall 2025, but these projections provide a strong indication of what’s ahead.

Medicare Current (2025) Projected (2026) Change
Part B Standard Premium ~$185/month $206.50/month +$21.50 (≈ 11.6%)
Part B Annual Deductible $257 $288 +$31 (≈ 12%)
Part D Base Beneficiary Premium ≈ $36.78 $38.99 +6%
Part D Deductible $590 $615 +$25
Part D Out-of-Pocket Cap (Catastrophic Threshold) $2,000 $2,100 +$100

Why These Numbers Matter

  • Even though some of these dollar amounts might seem modest, they add up across services, meds, and other out-of-pocket costs.

  • If your income is high enough, you may also pay extra (“IRMAA” surcharges) on top of these premiums. Small income changes could push you into higher cost brackets.

  • The projected increases mean that, for many, the cost of Medicare will take up a larger share of fixed-income resources (like Social Security).

Your Chance to Make Changes: AEP Is Coming

The Annual Enrollment Period (AEP) runs from October 15 through December 7 each year. This is the only time when most Medicare beneficiaries can:

  • Switch between Original Medicare and Medicare Advantage.

  • Change Medicare Advantage plans.

  • Review and update their Part D prescription drug coverage.

With costs rising in 2026, this year’s AEP is especially important. The plan that worked for you in 2025 may no longer be the most cost-effective option. Taking the time to review your coverage could save you hundreds of dollars in the coming year.

Review Your Medicare Plan

What You Can Do to Prepare

Since these numbers are already becoming public, you have time to act. Here are steps you can take now:

  • Review your current Medicare plan during the Annual Enrollment Period. Compare what you’re paying now to what you might pay in 2026.

  • Check your prescription drug plan carefully, especially if you pay a premium or lots of co-pays. Some drugs may move to different “tiers” (cost categories), affecting how much you pay.

  • Manage your taxable income, if possible, to avoid IRMAA surcharges. Actions like Roth IRA conversions, charitable contributions, or timing large income events might help.

  • Consider alternative plans such as Medicare Advantage or Medigap, which can sometimes offset rising Original Medicare costs.

  • Look into assistance programs (Extra Help, state assistance) if you qualify — they may reduce your premium or out-of-pocket drug costs.

📅 Don’t Miss These Important Dates: Medicare AEP 2025 Annual Enrollment Period (AEP): October 15 – December 7, 2025

This is your once-a-year opportunity to: Switch between Original Medicare and Medicare Advantage Change or update your Medicare Advantage plan Review and update your Part D prescription drug coverage With premiums, deductibles, and drug costs set to rise in 2026, this year’s AEP is more important than ever. Reviewing your coverage now could save you in the year ahead.
👉 Schedule your Medicare review today

Why a Medicare Review Is Important

Medicare isn’t static, and what worked for you in 2025 might cost more in 2026. A personalized review helps you:

  • Understand how projected changes will affect your specific situation (what you pay now vs. what you’ll pay).

  • Compare all your options side by side — Original Medicare, Medicare Advantage, Medigap, different Part D plans.

  • Avoid surprises when deductibles or premiums go up.

With Medicare costs expected to rise in 2026 — premiums, deductibles, drug-coverage costs — it’s more important than ever to stay informed and proactive. While we don’t yet have the final numbers from CMS, the projections are solid enough to begin planning.

👉 Schedule your Medicare review today so you’ll enter 2026 confident that your coverage fits your health needs and your budget.

Questions?

Disclaimer: This blog is for educational purposes only and does not constitute financial, tax, or legal advice. You should consult with a qualified financial and tax professional before making any decisions regarding financial products, tax filings, or deductions to determine what is appropriate for your specific situation. Scheduling a financial strategy session does not guarantee any specific financial outcome and may involve discussing financial products regulated by applicable laws.

Last Updated: September 4th, 2025

Secure Your Child’s Future: The Benefits of IULs and Cash-Value Life Insurance

As parents, we want to give our children the best possible future—one filled with opportunities, security, and financial freedom. While education savings accounts and traditional investments are helpful, there’s another powerful tool many families overlook: Indexed Universal Life Insurance (IUL) and other forms of cash-value life insurance.

This type of policy doesn’t just protect your child—it builds wealth over time, creates financial flexibility, and can even support them in major life milestones like college, buying a first home, or retirement.

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In this blog, we will discuss the following topics:

What is Indexed Universal Life (IUL) Insurance?

When to Purchase IUL Insurance

When not to purchase an IUL

Why the 0% Floor Matters

Watch Video on IULs

Benefits of IUL Insurance for Children

Risks Associated with IUL Insurance

How much does an IUL cost on average?

Other Types of Cash-Value Life Insurance and 529 plans

How to Set Up an IUL for your (grand)child

FAQ

Find out how much your child’s IUL would be with our Online Quoter

 

What is Indexed Universal Life (IUL) Insurance?

Indexed Universal Life (IUL) insurance is a type of cash-value life insurance that combines the benefits of traditional life insurance with potential for growth tied to the performance of specific market indexes. A portion of the premiums goes towards providing life insurance coverage, while the remainder is invested in indexed accounts, such as the S&P 500. As the market performs well, the policy’s cash value can grow, providing a potential source of funds for the policyholder. 

An Indexed Universal Life (IUL) policy is a type of permanent life insurance that does two things at once:

  1. Provides lifelong protection for your child with a death benefit.

  2. Builds a cash value account that grows over time, linked to a market index (like the S&P 500®).

The cash value growth is not invested directly in the stock market. Instead, it tracks an index and earns interest based on its performance, with a cap on how much you can earn in a given year—but also with a floor of 0%, so your child’s cash value won’t lose money in a down market.

This makes IULs unique: they combine the protection of life insurance with the growth potential of an investment-style account, without the same market risk.

Over time, the cash value can be accessed through loans or withdrawals, often on a tax-advantaged basis when structured properly. Families often use this cash value for:

  • College tuition

  • A first home down payment

  • Starting a business

  • Supplementing retirement income

This dual purpose—protection plus growth—is what makes IULs an attractive tool for parents planning ahead for their child’s future.

The Hypothetical example below shows how an IUL could work:

  • Parent: John and Mary are a young couple with a newborn son, James. They are concerned about providing for James’s financial future, so they decided to purchase an IUL policy for him.
  • Policy: The policy has a death benefit of $100,000 and a cash value growth potential of up to 10%. John and Mary make regular premium payments, and the policy’s cash value grows steadily over time.
  • Outcome: When James turns 18, he has a significant amount of cash value in his IUL policy. He uses the money to pay for college and has some money left over to start his own business.
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When to Purchase IUL Insurance?

Indexed universal life (IUL) insurance can be a good option for parents who want to provide financial security for their children.

Here are some of the people who may benefit from purchasing an IUL for their child:

  • Parents who want to provide a death benefit for their child. IUL insurance provides a death benefit, which can help to provide financial support for your child’s family if they die prematurely.
  • Parents who want to help their child save for college. The cash value of an IUL can be used to pay for college expenses, and the policy can also be used to provide tax-free withdrawals for qualified education expenses.
  • Parents who want to help their child build long-term wealth. The cash value of an IUL can grow over time, and it can be used to provide retirement income or other financial goals.

The best time to purchase IUL insurance for your child is as early as possible. Starting early allows for more time to accumulate cash value, maximizing the benefits over the policy’s lifetime. Additionally, young applicants often qualify for lower premiums, making it a cost-effective solution for securing their financial future.

There are many factors to consider when deciding when to purchase IUL insurance for your child, but generally speaking, the earlier the better. Here are some of the reasons why:

  • The younger your child is, the lower the premiums will be. This is because younger children are less likely to die, so the insurance company is less likely to have to pay out a death benefit.
  • The longer your child has for the cash value of the policy to grow, the more it will be worth. This is because the cash value of an IUL is invested in the stock market, so it has the potential to grow over time.
  • If your child has a chronic health condition or other risk factors, it may be more challenging to get them insured later in life. By purchasing an IUL policy when your child is young and healthy, you can lock in more favorable rates.

When not to purchase an IUL

  • You cannot afford the premiums. IUL premiums can be expensive, so it may not be the right option for you if you cannot afford to pay them.
  • Your child is not a good candidate for life insurance. If your child has a chronic health condition or other risk factors, an IUL may not be the right option.
  • You do not need the death benefit. If you do not need the death benefit of an IUL, there may be other financial products that are a better fit for your child’s needs.

Talking to a financial advisor to see if an IUL is right for your child’s specific situation is important. They can help you assess your child’s needs and goals and choose the right financial product for them.

Here are some additional factors to consider when deciding if an IUL is right for your child:

  • Your child’s financial goals. What are your child’s financial goals? Do they want to use the cash value of the policy to pay for college, start a business, or retire early?
  • Your child’s age. The younger your child is, the longer they have for the cash value of the policy to grow. However, younger children also tend to have lower premiums.
 

 

A Real-Life Example: How Compounding Works in an IUL

Imagine setting aside $150 per month into an IUL when your child is born. By the time they reach:

  • Age 18: A significant balance available for education or other early needs.

  • Age 30: Cash value has grown further, available for a home down payment or launching a business.

  • Age 65: A six-figure, tax-advantaged retirement supplement.

That’s the power of starting early, compounding growth, and market-linked returns with downside protection.

IUL cashflow

Why the 0% Floor Matters

Markets go up and down. But with an IUL, your child’s cash value won’t go negative in a downturn. While they may miss some upside caps, they’ll never see their account wiped out in a bear market.

Your Child’s Cash Value Will Never Go Below 0% in a Down Market

Benefits of IUL Insurance for Children

  1. Long-Term Financial Security:  An IUL policy for your child acts as a financial safety net, providing protection throughout their life. As the cash value grows over time, it can be used to supplement their education expenses, fund a down payment on a home, or even serve as a retirement nest egg. By starting early, you maximize the time available for the policy to grow, securing your child’s financial future.

  2. Tax Advantages: One of the most compelling benefits of IULs is the potential for tax-free retirement income. By allowing the cash value to grow over time, your child can access the accumulated funds during retirement without incurring income taxes, providing a valuable source of tax-free income in their golden years. This tax advantage can be a game-changer in ensuring a comfortable and stress-free retirement for your child.

  3. Flexibility in Premium Payments: IULs offer parents flexibility in premium payments. While it’s advisable to contribute regularly to maximize the benefits of the policy, parents can adjust premium amounts based on their financial circumstances, making it suitable for varying income levels.

  4. Guaranteed Death Benefit: In the unfortunate event of your child’s passing, the life insurance component of IUL insurance guarantees a death benefit to the beneficiaries. This financial support can cover funeral expenses, outstanding debts, and provide financial stability for the family during a difficult time.

  5. Educational Funding: As your child grows and approaches college age, the cash value in the IUL policy can serve as a valuable resource to fund their education. Whether they choose to attend college, pursue a vocational program, or start a business, having a cash-value life insurance policy provides a safety net to cover tuition, books, or other educational expenses.

  6. Building Good Financial Habits: By setting up an IUL or cash-value life insurance plan for your child, you teach them the importance of financial planning and responsibility from a young age. It can be a valuable lesson in securing their future and managing their finances wisely. As they become more involved in understanding the policy, they learn the value of long-term savings and financial discipline, setting them on a path towards financial success.

  7. Building a Legacy: IULs and cash-value life insurance allow you to create a lasting legacy for your child. As the policy grows, it can be passed down to the next generation, providing financial security for your grandchildren and beyond.

 

Indexed Universal Life (IUL) insurance presents a compelling option for parents seeking to secure their child’s future financially. With its potential for growth, tax advantages, and guaranteed death benefits, IUL insurance offers a unique combination of benefits. However, it’s essential to be aware of the associated risks.

Risks Associated with IUL Insurance:

  1. Market Volatility: IUL policies link their cash value to market indexes, such as the S&P 500. While this offers potential for growth, it also exposes the policy to market fluctuations. During market downturns, the cash value may not grow as expected, impacting the policy’s performance and potential benefits.

  2. Cap Rates and Participation Rates: IUL policies often come with cap rates and participation rates that limit the maximum return the policy can earn and determine how much of the index’s growth is credited to the cash value. These limitations can affect the policy’s potential for growth during periods of strong market performance.

  3. Cost of Insurance and Fees: IUL policies have various fees associated with them, including mortality and expense charges, administrative fees, and premium loads. These costs can reduce the overall returns on the policy and may impact the cash value growth

How much does an IUL cost on average?

The cost of an IUL for a child will vary depending on a number of factors, including the child’s age, the insurance company, the policy’s features, and the level of coverage. However, as a general rule of thumb, you can expect to pay between $100 and $300 per month for an IUL policy for a child.

Here are some factors that can affect the cost of an IUL for a child:

  • The child’s age: Younger children tend to have lower premiums than older children, as they are less likely to die.
  • The insurance company: Different insurance companies have different pricing structures for IUL policies.
  • The policy’s features: Policies with more features, such as the ability to invest in a wider range of investment options, will typically have higher premiums.
  • The level of coverage: The amount of life insurance coverage you choose will also affect the cost of the policy.

Some important notes

  • The importance of doing your research before buying an IUL. There are many different IUL policies available, and not all of them are created equal. It’s important to research and compare policies before buying one. You should consider factors such as the insurance company’s financial strength, the policy’s features, and the cost of the premiums.
  • The need for a financial advisor. A financial advisor can help you determine if an IUL is right for your child’s financial needs and goals. They can also help you choose the right policy and ensure that you understand its terms.
  • The importance of monitoring the policy’s performance. The performance of the IUL policy will depend on the performance of the underlying index. It’s important to monitor the policy’s performance regularly to ensure it meets your child’s financial needs.

Flexibility & Living Benefits

One of the strongest features of IULs is premium flexibility. Parents can start small, increase payments later, or pause during tough financial seasons.

Plus, many IULs include living benefits:

  • Early access to death benefits in case of critical illness or long-term care needs.

  • Provides not just a savings tool, but also a safety net during life’s unexpected turns.

Timing Is Everything: Start Early

Starting an IUL for your child while they’re young locks in:

  • Lower premiums (because of age and health).

  • More years of compounding growth.

  • A financial foundation before adulthood.

When considering any life insurance policy for your child, consulting with a qualified financial advisor is crucial. They can help tailor a policy to meet your family’s specific needs, assess your risk tolerance, and create a comprehensive financial plan to secure your child’s future. By understanding the basics, calculating coverage needs, and considering individual circumstances, you can make informed decisions about the type and amount of life insurance that suits your needs. Remember, life insurance is a powerful tool that offers financial security, peace of mind, and a lasting legacy for your loved ones. So, take the first step towards protecting your future today and get a quote below!

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Other Types of Cash-Value Life Insurance and 529 plans:

There are several different types of cash-value life insurance, including IULs, variable universal life insurance (VUL), and whole life insurance. Each type of policy has its own advantages and disadvantages.

  • Variable Universal Life (VUL) Insurance:

    VUL insurance combines life insurance coverage with investment options similar to mutual funds. Policyholders can allocate premiums into various investment accounts, giving them the potential for higher returns but also exposing them to market risks.

    In comparison with Index Universal Life Insurance,

    • VULs also offer the potential for growth,
    • The policyholder has more control over how the funds are invested.
    • However, VULs can be more complex than IULs, and there is a greater potential for losses.
  • Whole Life Insurance

    Whole life insurance is another type of cash-value life insurance that offers guaranteed death benefits, fixed premiums, and cash value accumulation. The cash value grows at a predetermined rate and can be accessed through loans or withdrawals. Since, the cash value of a whole life policy grows at a predetermined rate, there is less potential for growth than with an IUL or VUL.

  • Universal Life Insurance

    UL insurance provides flexibility in premium payments and the potential for cash value growth. Policyholders can adjust premium amounts and have the option to invest the cash value in various accounts, including fixed interest accounts or market-based accounts. The cash value of a universal life policy grows at a predetermined rate, which is typically lower than the rate of return on the stock market. However, universal life insurance is less risky than IULs, as the cash value is not subject to market fluctuations.

  • 529 Plans

    A 529 plan is a tax-advantaged savings plan designed to encourage saving for future education costs. Here are some key points about 529 plans:

    Pros:

    1. Tax Advantages: Contributions grow tax-deferred, and withdrawals for qualified education expenses are tax-free.
    2. High Contribution Limits: Most 529 plans have high contribution limits, allowing substantial savings.
    3. State Tax Benefits: Many states offer tax deductions or credits for contributions to a 529 plan.
    4. Control: The account owner retains control over the account and can change beneficiaries.

    Cons:

    1. Limited Use: Funds must be used for qualified education expenses, or you’ll face penalties and taxes on earnings.
    2. Market Risk: The investments in a 529 plan are subject to market risk, which can affect the value of your savings.
    3. Impact on Financial Aid: Assets in a 529 plan can impact a student’s eligibility for financial aid.

    Choosing between a 529 plan and an IUL depends on your specific goals and circumstances. If your primary focus is on saving for education with tax advantages, a 529 plan might be the better option. However, if you want more flexibility in how you use the funds, along with the added benefit of life insurance protection, an IUL could be a more suitable choice. 

    To discover more about the differences between 529 plans and IUL, check out our blog on this topic! https://policyengineer.com/differences-between-529-plans-and-indexed-universal-life-insurance-iul/

     

    How IULs Compare to Other Options

    Parents often ask, “Why not just use a 529 plan?” or “Shouldn’t I just buy term life?” Here’s a quick breakdown:

    Feature
    IUL for Kids
    529 Plan
    Term Life
    Use of Funds
    Flexible—education, housing, retirement, business
    Education only (penalties for other uses)
    No cash value, only death benefit
    Cash Value Growth
    Indexed growth + 0% floor
    Market-linked, no floor
    None
    Tax Benefits
    Tax-advantaged distributions
    Tax-free if for education
    N/A
    Protection
    Lifelong insurance coverage
    None
    Only while the term lasts

    An IUL isn’t just insurance—it’s a strategy. It’s about giving your child options, freedom, and a financial head start that keeps compounding for decades.

    A small decision today can unlock lifelong opportunities for your child tomorrow.

    Flexibility & Living Benefits

    One of the strongest features of IULs is premium flexibility. Parents can start small, increase payments later, or pause during tough financial seasons.

    Plus, many IULs include living benefits:

    • Early access to death benefits in case of critical illness or long-term care needs.

    • Provides not just a savings tool, but also a safety net during life’s unexpected turns.

    Timing Is Everything: Start Early

    Starting an IUL for your child while they’re young locks in:

    • Lower premiums (because of age and health).

    • More years of compounding growth.

    • A financial foundation before adulthood.

    The earlier you start, the more powerful the results.

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How to Set Up an IUL for your (grand)child

Your Child’s Future: The Benefits of IULs and Cash-Value Life Insurance
Need Help?

Setting up an IUL or cash-value life insurance plan for your child is straightforward. Here are the steps to get started:

      1. Research: Begin by researching reputable insurance companies that offer child-specific policies. Look for strong financial ratings and customer reviews to ensure reliability.

      2. Consult an Insurance Agent: Reach out to a licensed insurance agent who specializes in life insurance and can guide you through the available options based on your child’s needs and your financial goals.

      3. Choose the Right Plan: Select an IUL or cash-value life insurance plan that aligns with your long-term objectives, considering factors like premium affordability and potential investment growth.

      4. Set Up the Policy: Once you’ve chosen the policy, work with your insurance agent to complete the necessary paperwork and set up the plan. Make sure to review the policy details and ask any questions before finalizing the agreement.

      5. Monitor and Review: Keep a regular check on the policy’s performance and periodically review it with your insurance agent to ensure it continues to meet your child’s evolving needs.

Frequently Asked Questions About Indexed Univeral Life

1. What is Indexed Universal Life (IUL) insurance? Indexed Universal Life (IUL) insurance is a type of cash-value life insurance that combines life insurance protection with the potential for cash value growth linked to the performance of specific market indexes, such as the S&P 500. It offers policyholders the opportunity to accumulate tax-deferred cash value over time.

2. How does IUL insurance work? With IUL insurance, a portion of your premium payments goes towards providing life insurance coverage, while the remaining amount is invested in indexed accounts. The cash value grows based on the performance of the chosen index. Policyholders can access the accumulated cash value through policy loans or withdrawals, often tax-free.

3. What are the benefits of IUL insurance for children? IUL insurance offers several benefits for securing your child’s future, including long-term financial security, a tax-advantaged savings component, a guaranteed death benefit, and the potential to supplement education expenses or provide a retirement income stream.

4. When is the best time to purchase IUL insurance for a child? The best time to purchase IUL insurance for a child is as early as possible. Starting early allows more time for the cash value to grow, potentially maximizing the policy’s benefits over the long term. Additionally, younger applicants often qualify for lower premiums.

5. What are the risks associated with IUL insurance? Some of the risks of IUL insurance include market volatility, which can impact cash value growth during market downturns, cap rates and participation rates that limit potential returns, the cost of insurance and fees, and surrender charges if the policy is surrendered or withdrawn within a specific period.

6. What other types of cash-value life insurance options are available? Other types of cash-value life insurance options include Whole Life Insurance, which provides guaranteed death benefits, fixed premiums, and cash value accumulation; Variable Universal Life (VUL) Insurance, which combines life insurance coverage with investment options; and Universal Life Insurance (UL), which offers flexibility in premium payments and investment choices.

7. How can I determine if IUL insurance is suitable for my child’s future? To determine if IUL insurance is suitable for your child’s future, consider factors such as your child’s financial needs and goals, risk tolerance, and your overall financial plan. Consulting with a qualified financial advisor can help you make an informed decision and tailor a policy to meet your family’s specific needs.

8. Can I use the cash value in the IUL policy for my child’s education expenses? Yes, the cash value accumulated in the IUL policy can be used to supplement your child’s education expenses, providing a valuable source of funding for college tuition, vocational training, or other educational pursuits.

9. Is IUL insurance a good option for tax-free retirement income? Yes, IUL insurance can provide a potential source of tax-free retirement income. By allowing the cash value to grow over time, policyholders can access the accumulated funds during retirement without incurring income taxes, offering a valuable financial resource in their golden years.

10. How can I set up an IUL insurance policy for my child? To set up an IUL insurance policy for your child, research reputable insurance companies, consult a licensed insurance agent specializing in life insurance, choose the right policy based on your child’s needs and your financial goals, complete the necessary paperwork, and periodically review the policy’s performance with your insurance agent to ensure it meets your child’s evolving needs.

 

 

Find out how much your child’s IUL would be with our Quoter

Understanding the “Big Beautiful Bill” (BBB)

The “Big Beautiful Bill” (BBB) is a proposed legislative package scheduled to take effect January 1, 2026, introducing a broad range of tax, retirement, and healthcare-related changes. It aims to make permanent many of the tax reductions first introduced by the 2017 Tax Cuts and Jobs Act (TCJA), while also creating new deductions and adjusting federal benefits programs.

A Purely Educational Overview of Key 2026 Changes Published by Policy Engineer Insurance Solutions — For Informational Purposes Only  At Policy Engineer Insurance Solutions, our goal is to help you understand these changes from a non-political, educational standpoint so you can plan with clarity.

Effective January 1, 2026

What Is the Big Beautiful Bill?

The Big Beautiful Bill (BBB) is a comprehensive legislative package passed in mid-2025 and scheduled to take effect January 1, 2026. It includes sweeping updates to tax policy, healthcare programs, estate planning, and retirement accounts. Many of its provisions make permanent key elements of the 2017 Tax Cuts and Jobs Act (TCJA), while also introducing new deductions, eligibility rules, and planning opportunities.

This article is provided for informational purposes only and is intended to help individuals and business owners understand the changes from a neutral, educational perspective.

Category Change
Income Tax Rates                      2017 TCJA brackets made permanent
Standard Deduction +$1,000 (Single), +$2,000 (Married Filing Jointly)
SALT Deduction Cap Raised to $40,000
Child Tax Credit Permanently increased to $2,200
Senior Bonus Deduction $4,000 (Age 65+, 2025–2028)
QBI Deduction Made permanent at 20%
Estate Tax Exemption $15 million (adjusted for inflation)
HSA Contribution Boost +$4,300 (for individuals with income under $75K)
Trump Accounts New IRA class for minors under age 18
Medicare Risks Up to $500B in automatic cuts (2026–2034)
Medicaid Requirements 80-hour work rule + 6-month eligibility checks
Bonus Depreciation 100% equipment write-off (2025–2029)
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Key 2026 Tax Changes

Income Tax Rates
The current lower tax brackets introduced under the TCJA are now permanent. These rates will no longer sunset in 2026, preserving the current bracket structure.

Standard Deduction Increase

  • Single filers: +$1,000

  • Married filing jointly: +$2,000
    These increases are indexed for inflation beyond 2026.

SALT Deduction Cap Raised
The State and Local Tax (SALT) deduction cap increases from $10,000 to $40,000 beginning in 2026. The cap phases down starting in 2030.

Child Tax Credit
The Child Tax Credit is permanently increased to $2,200 per qualifying child and will be indexed for inflation.

Senior Bonus Deduction
A $6,000 additional deduction is available to taxpayers aged 65 and older between 2025 and 2028. Income phaseouts apply for higher-income individuals.

Business and Investment Provisions

100% Bonus Depreciation
Businesses can deduct 100% of qualified asset costs in the first year for property placed in service after January 19, 2025. This full bonus depreciation is available through 2029.

Qualified Business Income (QBI) Deduction
The 20% QBI deduction for pass-through businesses is made permanent under the new law.

New Savings Tools and Incentives

“Trump Kids” Account
A new class of tax-advantaged IRAs is created for minors under age 18. These accounts include a $1,000 one-time birth bonus and allow up to $5,000 in annual contributions. Funds grow tax-deferred and can be used for education, first-time home purchase, or retirement.

Health Savings Account (HSA) Expansion

  • Individuals earning less than $75,000 annually may contribute an additional $4,300

  • Family coverage limits increase by up to $8,550

  • Eligibility is expanded to include certain bronze and silver health plans

Tips and Overtime Income Tax Relief
Up to $25,000 in tips and overtime wages annually will be exempt from federal income tax through 2028.

Retirement and Estate Planning

Estate Tax Exemption
The federal estate tax exemption is permanently set at $15 million per individual and adjusted annually for inflation.

Roth IRA Strategy Opportunity
With tax brackets locked in, many individuals may benefit from strategic Roth conversions over the next few years.

Medicare Changes

Medicare Savings Program Delay
An expansion of eligibility rules for the Medicare Savings Program is delayed until 2034.

Drug Pricing Reforms
Medicare will be allowed to negotiate more prescription drug prices, and growth in provider reimbursements will slow over the next decade.

PAYGO Spending Cuts
Under current budget rules, automatic reductions may apply beginning in 2026, including:

  • Up to $500 billion in total Medicare cuts (2026–2034)

  • A 4% across-the-board provider reimbursement cut unless overridden by Congress

Medicaid Reform

Key Provisions Include:

  • $1 trillion reduction in federal Medicaid funding over 10 years

  • Mandatory 80-hour per month work or community engagement requirements for able-bodied adults without dependents

  • Re-verification of eligibility every six months for Medicaid expansion groups

  • Estimated 11 to 12 million individuals could lose coverage due to new administrative hurdles or work requirements

  • States like California may seek to offset some provisions at the state level (e.g., Medi-Cal protections)

Social Security and SSI

No Cuts to SSI Benefits
There are no direct cuts to Supplemental Security Income (SSI) for individuals with disabilities.

Social Security Remains Taxable
Despite campaign discussion, Social Security income remains subject to taxation. The new senior deduction may help offset some taxes for retirees.

Economic Impact Projections

Expected Benefits

  • GDP growth projected at 1.2% over the long term

  • 62% of taxpayers avoid rate increases that would have occurred under the TCJA sunset

  • 100% bonus depreciation aims to increase business investment in equipment and property

Potential Risks

  • Estimated $3.6 trillion increase to the federal deficit over 10 years

  • Up to 1.2 million jobs may be impacted due to public sector spending reductions

  • Debt-to-GDP ratio could rise above 170% by 2060 if no further adjustments are made

Questions?

What Should You Do?

Strategic Planning Opportunities

  • Consider Roth conversions while tax rates remain low

  • Maximize HSA and IRA contributions under the new thresholds

  • Revisit your estate plan based on the $15 million exemption

  • Explore the Trump Kids Account for long-term intergenerational wealth planning

Risk Mitigation

  • Evaluate Medicare Advantage or Medigap plans ahead of reimbursement changes

  • Consider long-term care strategies, including asset-based or hybrid coverage, especially as Medicaid rules become stricter

Ready to Strategize?

At Policy Engineer Insurance Solutions, our Advanced Markets Team is here to help you make sense of these changes—without pressure and without sales tactics.

We can help you:

  • Review tax planning strategies

  • Maximize HSA and IRA savings

  • Build or update an estate plan

  • Evaluate Medicare or long-term care options

To schedule your confidential planning session, contact us directly:

Schedule Here
Email: info@policyengineer.com

We’re committed to helping you plan smart, stay compliant, and protect what matters—no matter what comes next.

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Last Updated: September 15th, 2025

Why Taxes Matter for Freelancers and Business Owners

Running your own business or managing a side hustle can be rewarding, but it also comes with responsibilities, and taxes are a big one. Taking a little time to understand the basics can save you from costly mistakes and help you keep more of what you earn.

Whether you’re just getting started or have been freelancing for years, here are key things to know about taxes and managing your business finances.

This blog is for educational purposes only and does not constitute financial, tax, or legal advice. You should consult with a qualified financial and tax professional before making any decisions regarding financial products, tax filings, or deductions to determine what is appropriate for your specific situation.

Schedule A Free Strategy Session

Do You Need to Pay Taxes on Your Side Hustle?

If you made more than $400 from freelance work or a side business last year, you are required to report that income and likely owe self-employment taxes. Even if you didn’t receive a 1099 form from the client, you are still responsible for reporting all income you earned.

It’s important to remember: clients who paid you may be deducting their payments to you as business expenses and could have reported those payments to the IRS. Failing to report your freelance income can create discrepancies that may trigger IRS notices or even audits.

Bottom line: Always report all the income you earn — even if you didn’t receive formal tax documents.

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Why You Should Separate Business and Personal Finances

Mixing personal and business finances can cause confusion and headaches when it’s time to file taxes. Separating them makes it easier to track expenses, calculate deductions, and organize your financial records.

Simple ways to separate your finances:

  • Open a business bank account.

  • Use a dedicated business credit card.

  • Track all business expenses separately from personal ones.

By doing this, you’ll streamline the tax-filing process and have cleaner, more accurate records if you’re ever audited.

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Tools That Can Help You Stay Organized

Keeping accurate records doesn’t have to be overwhelming. Many apps and programs can automate much of the process:

  • QuickBooks: A popular choice for tracking income and expenses, reconciling accounts, and preparing financial reports.

  • Expense Tracking Apps: Some apps allow you to split bills (like a phone bill used for both business and personal purposes) and even track your business mileage through GPS.

Using these tools regularly — like reconciling your books weekly or monthly — can prevent surprises and give you a clear financial picture throughout the year.

Top Tax Deductions for Freelancers and Business Owners

Understanding available deductions can significantly lower your taxable income. Some of the most common deductions include:

  • Home Office Deduction: If you have a dedicated space for work, you can deduct a portion of your rent, utilities, and internet costs based on the square footage used for business.

  • Office Supplies and Equipment: Furniture, technology, and supplies purchased for business use may be deductible.

  • Business Meals: You can generally deduct 50% of the cost of business-related meals.

  • Health Insurance Premiums: Self-employed individuals can often deduct 100% of their health insurance premiums.

  • Inventory Costs: Costs associated with storing or purchasing inventory may be deductible, even before you sell the products.

  • Mileage: Business-related driving miles can add up, and there are apps that help track this easily.

Don’t Forget About Retirement Contributions

Self-employed individuals have several retirement savings options, and contributions may be tax-deductible. Popular retirement accounts for freelancers include:

  • Solo 401(k)

  • SEP IRA

  • SIMPLE IRA

  • Traditional IRA

Choosing the right retirement plan for your situation can lower your taxable income today while helping you save for the future.

Understanding 1099 Forms: NEC vs. K

When it comes to freelance income, two types of 1099 forms are common:

  • 1099-NEC: Issued when a client pays you $600 or more for services.

  • 1099-K: Issued by third-party platforms (like PayPal or Venmo) if you process over 200 transactions or $20,000 in a year.

Even if you don’t receive these forms, you are still responsible for reporting the income. Download your transaction history and keep your own records to ensure you report all earnings properly.

Quarterly Taxes: Are You Required to Pay?

If you expect to owe $1,000 or more in federal income taxes for the year, the IRS requires you to make estimated quarterly payments. Key quarterly due dates are:

  • April 15

  • June 15

  • September 15

  • January 15 (of the following year)

Quarterly payments are based on your net profits — total income minus allowable business expenses — so maintaining accurate records is essential.

Questions?

Disclaimer: This blog is for educational purposes only and does not constitute financial, tax, or legal advice. You should consult with a qualified financial and tax professional before making any decisions regarding financial products, tax filings, or deductions to determine what is appropriate for your specific situation. Scheduling a financial strategy session does not guarantee any specific financial outcome and may involve discussing financial products regulated by applicable laws.

Last Updated: April 27th, 2025

Maximizing Tax Efficiency: Commonly Overlooked Deductions and Credits

Each year, taxpayers miss out on valuable opportunities to reduce their taxable income and overall tax liability simply by not utilizing available deductions and credits. Understanding the distinctions between these two mechanisms is essential for efficient tax planning.

This blog is for educational purposes only and does not constitute financial, tax, or legal advice. You should consult with a qualified financial and tax professional before making any decisions regarding financial products, tax filings, or deductions to determine what is appropriate for your specific situation.

Schedule A Free Strategy Session

Deductions vs. Credits: Understanding the Difference

While both deductions and credits provide tax benefits, they function differently.

  • Tax Deductions reduce the amount of taxable income. For instance, a $5,000 deduction lowers taxable income from $95,000 to $90,000, thereby decreasing the amount of income subject to taxation.
  • Tax Credits, on the other hand, directly reduce the amount of tax owed. If a taxpayer owes $3,000 in taxes, a $2,000 credit reduces that liability to $1,000.

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Commonly Missed Tax Deductions

Several deductions are frequently overlooked, potentially resulting in taxpayers paying more than necessary. Some of the most notable include:

1. Student Loan Interest Deduction

Taxpayers who have taken out student loans—or loans on behalf of dependents—may be eligible to deduct up to $2,500 in interest payments for 2024. Retaining documentation from loan servicers is key to claiming this deduction.

2. Health Savings Account (HSA) Contributions

For individuals with qualifying high-deductible health plans (HDHPs), HSA contributions remain a valuable deduction. For 2024, individuals can contribute up to $4,150, while families can contribute up to $8,300. Notably, contributions for the prior tax year may still be made until the tax filing deadline (April 15).

3. Traditional IRA Contributions

IRA contributions also remain deductible under specific conditions. The contribution limit for 2024 is $7,000 for individuals under 50, with an additional $1,000 in “catch-up” contributions for those aged 50 and older. Like HSAs, IRA contributions can be applied retroactively up until the tax filing deadline.

4. Early Withdrawal Penalty Deduction

Taxpayers who incur penalties for early withdrawals from savings accounts, such as Certificates of Deposit (CDs), may be able to deduct these penalties. Retaining bank statements detailing these penalties is essential.

5. Educator Expense Deduction

Teachers and eligible educators (K-12) may deduct up to $300 for unreimbursed classroom expenses, such as supplies and instructional materials.

6. Self-Employment Deductions

Self-employed individuals often qualify for a variety of deductions, including:

  • Self-Employment Tax Deduction: A portion of Social Security and Medicare taxes paid by self-employed individuals may be deductible.
  • Health Insurance Deduction: Self-employed taxpayers who purchase their own health insurance may deduct premiums for themselves, spouses, and dependents.

7. Military Relocation Deduction

Active-duty military personnel who are required to relocate as part of their service may qualify for moving expense deductions. Documentation of expenses related to relocation is necessary for potential eligibility.

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Commonly Missed Tax Credits

Unlike deductions, which reduce taxable income, tax credits provide a dollar-for-dollar reduction in tax liability. Some widely applicable tax credits include:

1. Earned Income Tax Credit (EITC)

Designed for low-to-moderate income earners, the EITC can provide a credit of up to $7,830 for qualifying individuals, depending on income and filing status.

2. Lifetime Learning Credit

Individuals who pursue higher education may be eligible for a credit of up to $2,000 for tuition and educational expenses. The credit is not limited to degree programs, so various skills-enhancing courses may qualify.

3. Energy-Efficient Home Credit

Homeowners who make qualifying energy-efficient improvements—such as installing solar panels or upgrading HVAC systems—may qualify for a credit of up to $3,200. This credit typically covers 30% of eligible expenses.

4. Electric Vehicle (EV) Credit

Taxpayers who purchased an electric vehicle in 2024 may qualify for a credit of up to $7,500 for new EVs and $4,000 for used EVs, subject to income limitations. Additionally, some states provide separate incentives that may supplement this federal credit.

5. Child and Dependent Care Credit

Parents who pay for childcare services may qualify for a tax credit of up to $3,000 for one child or $6,000 for two or more children. Proof of expenses, such as receipts from childcare providers, is typically required.

Key Considerations When Filing

To maximize tax benefits, taxpayers should keep the following considerations in mind:

  • Documentation is Essential: Retaining receipts, account statements, and other proof of expenses ensures eligibility for deductions and credits.
  • Understand Eligibility Requirements: Many credits and deductions have income limitations or phase-outs. Taxpayers should review these requirements to determine eligibility.
  • Filing Early Can Prevent Missed Opportunities: Preparing tax documents in advance helps ensure all potential deductions and credits are accounted for before the filing deadline.

Final Thoughts

By staying informed about tax deductions and credits, taxpayers can better navigate the filing process and potentially reduce their tax liability. While tax software and professional tax preparers can assist in optimizing returns, individual awareness of these tax-saving opportunities remains crucial.

📺 Watch the Video Above!
If you found this information helpful and want to explore it further, watch the video at the top of this post for a full breakdown.

Questions?

Disclaimer: This blog is for educational purposes only and does not constitute financial, tax, or legal advice. You should consult with a qualified financial and tax professional before making any decisions regarding financial products, tax filings, or deductions to determine what is appropriate for your specific situation. Scheduling a financial strategy session does not guarantee any specific financial outcome and may involve discussing financial products regulated by applicable laws.

Last Updated: March 16th, 2025

Tax Season 2025: What You Need to Know Before Filing

Tax season is officially here, and the IRS expects approximately 168 million tax returns to be filed this year. Whether you’re an individual filer or a business owner, it’s time to get organized. In this guide, we’ll cover key topics to help you navigate tax season efficiently.

This blog is for educational purposes only and does not constitute financial, tax, or legal advice. You should consult with a qualified financial and tax professional before making any decisions regarding financial products, tax filings, or deductions to determine what is appropriate for your specific situation.

Schedule A Free Strategy Session

Do You Even Need to File Taxes?

The income thresholds for 2025 are:

  • Single: You must file if you made more than $15,000 in gross income before deductions.

  • Married Filing Jointly: You must file if your combined income is over $30,000.

  • Head of Household: You must file if you made more than $22,500.

  • Self-Employed: If you made over $400, you are required to file taxes.

    However, even if your income falls below these thresholds, filing may still be beneficial, especially if taxes were withheld from your paychecks. Filing may allow you to claim a refund if you overpaid taxes. Additionally, some individuals qualify for refundable credits, such as the Earned Income Tax Credit (EITC) or the Child Tax Credit, even if they are not required to file.

Why Some Americans Miss Out on Refunds

The IRS estimates that 1.5 million people miss out on tax refunds each year simply because they don’t file. If you had income taxes withheld but didn’t meet the filing threshold, you might be leaving money on the table. Filing your taxes may allow you to reclaim any overpaid amounts.

 

What Documents Do You Need to File Taxes?

Gathering the right documents is crucial for an accurate and efficient filing process. Here are the essentials:

Income Forms:

  • W-2: If you’re employed, you’ll receive a W-2 from your employer.

  • 1099 Forms: If you earned income from freelance work, dividends, or retirement accounts, you may receive one of the following:

    • 1099-NEC (Non-Employee Compensation) for gig work or self-employment.

    • 1099-DIV for dividends from investments.

    • 1099-R for distributions from IRAs and 401(k)s (withdrawals may be subject to taxes and penalties if taken before age 59½).

Deductions and Credits:

  • Mortgage interest statements (if you own a home)

  • Student loan interest statements

  • Charitable donation receipts

  • Medical expense records

  • Home office deduction information (square footage of your workspace if self-employed)

  • Business expense records (for self-employed individuals)

 

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Standard Deduction vs. Itemizing: Which One is Best?

Most taxpayers opt for the standard deduction, which simplifies the filing process. For 2025, the standard deduction amounts are:

  • Single: $15,000

  • Married Filing Jointly: $30,000

  • Head of Household: $22,500

Additional Deduction for 65+:

  • Single: $2,000

  • Married Filing Jointly: $1,600 per person over 65

Itemizing makes sense if your deductible expenses exceed these amounts. This includes mortgage interest, medical expenses, and charitable donations

Tax Filing Deadlines: Mark Your Calendar

  • April 15, 2025: Standard deadline for filing personal tax returns.

  • October 15, 2025: Deadline for extensions.

  • March 15, 2025: Filing deadline for S-Corps, LLCs, and partnerships.

  • September 15, 2025: Extension deadline for business filings.

Filing early ensures you receive any potential refunds sooner.

The Truth About Tax Refunds: It’s Your Money

Filing early may help you receive any potential refunds sooner, depending on IRS processing times.

The Truth About Tax Refunds: It’s Your Money Many Americans view tax refunds as a financial windfall, but in reality, they represent money that was overpaid to the government throughout the year. Instead of giving the IRS an interest-free loan, consider adjusting your tax withholdings to receive more money in each paycheck. Updating your W-4 with your employer can help ensure your withholdings are accurate.

 

Questions?

Disclaimer: This blog is for educational purposes only and does not constitute financial, tax, or legal advice. You should consult with a qualified financial and tax professional before making any decisions regarding financial products, tax filings, or deductions to determine what is appropriate for your specific situation. Scheduling a financial strategy session does not guarantee any specific financial outcome and may involve discussing financial products regulated by applicable laws.

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