Big Changes Coming to Social Security in 2026
As we get ready to usher in a new year, there are several big changes to Social Security you need to know about. A recent article by AOL explains each one and what it will mean to you.
A bigger COLA means bigger benefits. The average retired worker will receive an additional $56 in benefits in 2026. That’s thanks to a 2.8 percent cost-of-living adjustment (COLA) to help recipients keep up with rising costs due to inflation.
Earnings test threshold increases. This applies to anyone still working and collecting Social Security retirement benefits. If you have not reached full retirement age (FRA), you can only earn up to a certain amount per year; if you cross that threshold, your benefits will be reduced. Fortunately, once you reach FRA, the earnings test ends. At that point, you can earn any amount with no reduction, and Social Security will adjust your benefit to credit back what was withheld. In 2026, the earnings limit is $65,160.
Higher payroll tax cap. In 2026, the maximum amount of income subject to Social Security’s 6.2 percent payroll tax rises to $184,500, up from $176,100 this year. This means that higher wage earners will pay a bit more in Social Security payroll taxes next year, but retirees won’t feel any direct impact.
Special senior deduction starts. According to the article, a “new federal tax deduction for older taxpayers goes into effect next year, allowing anyone 65 or older to subtract up to $6,000 from their taxable income. For many retirees, this could sharply reduce, or even eliminate, the federal taxes they owe on Social Security.”
It’s important that seniors understand the changes coming to Social Security in 2026, as it will directly impact their benefits and expenses.
The Seniors Trust is committed to improving the financial well-being of older Americans through the passage of the Social Security Expansion Act. It will give retirees an immediate benefits increase of about $200 a month, a fair annual COLA, increased minimum benefits, and ensure the long-term solvency of the Social Security program.
