If you cashed in an IRA in 2005, it could affect your 2007 premium. To determine your 2007 Part B premium, Social Security uses the most recent tax return information provided by the Internal Revenue Service (IRS). Generally, this information is for tax year 2005. Social Security uses your modified adjusted gross income (MAGI) to make this determination. Your MAGI is a combination of your adjusted gross income and tax exempt interest income.

To determine your 2008 premium, Social Security generally will use your tax return information for 2006. Your return for tax year 2006 will reflect only your income for that year. So, if your premium increased in 2007 because you cashed in an IRA in 2005, it could decrease in 2008. Your 2008 Part B premium depends on your income for tax year 2006.

For more information, see Social Security's publication, Medicare Part B Premiums: New Rules For Beneficiaries With Higher Incomes 2006, call toll-free at 1-800-772-1213 (TTY 1-800-325-0778) or visit your local Social Security office.

To learn more about Medicare Part B coverage, visit www.medicare.gov.