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If you collect Social Security, your monthly payments and tax obligations may look different in 2026. The Social Security Administration updates key program rules every year to keep pace with the economy, and those adjustments can affect how much retirees get, as well as how much employees contribute.
AARP recently highlighted the most important updates for beneficiaries. To get you through this year and also think about future changes, here are three major Social Security changes to know about for 2026, and how they could affect your income.
1. 2026 COLA boost: Social Security payments increased by 2.8%
The cost of living adjustment, or COLA, helps ensure that your retirement income keeps up with inflation. You may have already seen in your benefits that this year’s COLA is 2.8%.
“For the average retiree, this means about $56 more per month or about $672 more per year,” said Nancy LeMond, chief advocacy and engagement officer at AARP. recent videos.
However, most retirees won’t see the full increase in their checks. That’s because the standard Medicare Part B premium — which is automatically deducted from most beneficiaries’ payments — has increased by about $21 per month. After this deduction, the typical retiree’s benefits increase by about $35 per month.
While modest, the 2026 COLA still provides significant inflation protection for retirees who rely heavily on Social Security.
2. Higher income test threshold for early claimants
The Social Security Administration also made changes to the retirement earnings test, the calculation it uses to temporarily reduce benefits if you start collecting before your full retirement age and are still working.
If you earn more than a certain amount, Social Security cuts benefits by $1 for every $2 you earn over the limit. In 2026, this limit increases by $1,080 to approximately $24,480. This means you can now earn more without seeing your benefits cut. However, even if you earn above this limit, it is important to remember that you do not lose this money forever.
“You’ll get it back in the form of a higher monthly benefit once you reach your full retirement age,” LeMond said. “And once you reach your full retirement age, the retirement income test ends. At that point, there are no limits and no deductions.”
For older workers – especially those earning part-time income – this higher limit provides more breathing room in 2026.
3. Increase in 2026 payroll tax income limits for workers
The third major change involves the maximum taxable income. This affects how much of your income goes into Social Security while you’re working.
“Most of us pay into the program through taxes on our earnings, but there is a limit on how much of those earnings are taxed — it’s the taxable maximum,” LeMond said.
This increases by $8,400 to $184,500 in 2026.
“Once you earn that amount, you stop paying Social Security taxes for the rest of the year,” LeMond said. “This increase brings more revenue into the system to help keep Social Security funded now and in the future.”
While this change primarily affects high-income earners, the increased taxable maximum amount is part of ongoing efforts to strengthen the long-term sustainability of the Social Security program for all beneficiaries.
Key Points for Social Security Beneficiaries
AARP highlighted three important points for anyone receiving benefits or who may soon receive benefits:
- If you’re collecting Social Security, you’ll see a slight increase in your monthly payments.
- If you’re receiving Social Security while still working past your full retirement age, you can earn more before any benefits are withheld.
- Higher-income workers will pay a greater share of their annual earnings into Social Security. These adjustments help Social Security keep pace with the economy while remaining sustainable for future retirees.
Understanding these changes can help you better plan for 2026, whether you’re already receiving Social Security or preparing to claim benefits soon.