Medicare's two-year look-back rule can cause a sharp increase in monthly premiums for retirees who sell their homes too close to age 65. The rule uses tax returns from two years prior to calculate the income-related monthly adjustment amount, or IRMAA, which raises premiums for higher-income beneficiaries. Mike McCracken, president and founder of Wealth Guide Financial, told Fortune that selling a home at age 64 and realizing a capital gain in 2025 can trigger higher premiums starting in 2027. For example, a couple retiring at 62 and downsizing with $350,000 in taxable gains could be pushed into the second or third IRMAA tier, adding hundreds of dollars to their monthly premiums. To avoid the surcharge, experts recommend selling before age 63, aging in place, or using the IRS capital gains exclusion of up to $250,000 for singles and $500,000 for married couples, though profits above those limits will still affect premiums. The higher premiums are temporary and will return to normal once the two-year look-back period passes.