In January 2026, several changes to Social Security will take effect, impacting everything from credits and taxes to benefit checks and full retirement age (FRA) rules. Knowing about these updates ahead of time can help you be prepared for the year ahead and adjust your plans to make sure you collect the maximum benefit.
These changes don’t only impact retirees — they impact current workers. Workers need to keep an eye on accumulating enough Social Security credits to get benefits, correct errors in their earnings record, and understand how much of their wages will be subject to the 6.2% Social Security tax.
These numbers are estimates; the official limits for 2026 will be announced later in the year, usually in mid-October. The estimates come from the 2025 Social Security Trustees Report and The Senior Citizens League (TSCL), and are subject to change. However, they are good guidelines for early planning. The article will be updated to reflect the latest information from the Social Security Administration (SSA) and official numbers when they become available.
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Let’s take a look at what’s in store for 2026:
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1. Social Security cost of living adjustment (COLA) for 2026 is looking low
The COLA for 2026 is projected to be slightly higher than last year’s COLA of 2.5%; the TSCL anticipates a small increase of 2.7%, which matches their July prediction.
Older people are caught in a ‘COLA catch-22.’ A higher COLA means more money for retirees, but it’s a direct result of higher inflation. Conversely, a lower COLA means inflationary pressure is less acute, but it provides less money to help retirees with rising costs such as medical expenses and housing.
“With the COLA announcement around the corner, seniors across America are holding their breath,” says Shannon Benton, Executive Director of The Senior Citizens League.
“While a higher COLA would be welcome because their monthly benefits will increase, many will be disappointed,” Benton says. “TSCL’s research shows that many seniors believe the COLA does not adequately capture the inflation they experience.”
A big increase in Medicare premiums can consume almost half of your annual increase. The 2025 Social Security Trustees Report projects a $206.50 monthly premium for next year, up $21.50 or 11.6% from 2025. That would represent the largest Part B increase in dollar terms since 2022, when premiums rose by $21.60.
If the 2026 Social Security COLA ends up coming in at the estimated 2.7%, that would translate into an increase of $54.18 per month, or $650.16 per year (when using the average Social Security check amount for July 2025 ($2,006.69) as the base amount).
The Social Security Administration (SSA) automatically deducts the Part B premium cost from the Social Security benefits of most Medicare recipients.
That would effectively reduce the increase to the average Social Security check in 2026 from $54.18 to $32.68, after subtracting the projected Part B increase ($21.50) from the projected 2026 COLA raise ($54.18). In that scenario, the Part B increase will consume almost 40% of the monthly increase.
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2. Full retirement age (FRA) goes up in 2026
In November 2025, the full retirement age (FRA) — the age at which individuals are eligible to receive 100% of their Social Security benefits — will increase to 66 years and 10 months for those born in 1959.
In 2026, the FRA will reach 67 for those born in 1960 or later — a threshold that will mark the culmination of the forty-two-year-long shift in raising the retirement age.
This is the final step in a gradual schedule to increase the retirement age from 65 to 67, set in motion by the 1983 amendments to the Social Security Act. The legislation was meant to reflect longer life expectancies, reduce financial strain on the program, and shore up the trust fund.
Here is when you will reach your FRA, by birth year:
- If you were born in 1960 or later, your FRA is age 67 and will be reached in 2026 and after
- If you were born in 1959, your FRA is age 66 and 10 months and is reached in 2025
- If you were born in 1958, your FRA is age 66 and six months and was reached in 2024
NOTE: People born on January 1 of any year should refer to the previous year.
When you claim your Social Security benefits can greatly impact the size of your monthly check. If you retire at age 62, the earliest possible Social Security retirement age, your benefit will be lower than if you wait till your FRA. The more months remaining between age 62 and your FRA, the more your monthly payments will be reduced.
Early retirement will reduce your benefits by 5/9 of 1% for each month before normal retirement age, up to 36 months. If the number of months exceeds 36, then the benefit is further reduced by 5/12 of 1% per month.
If you choose to continue working beyond your full retirement age and delay applying for benefits, you can increase future Social Security benefits in two ways: each extra year you work adds another year of earnings to your Social Security record, and higher lifetime earnings can mean higher benefits when you retire.
If you delay taking your benefits, your monthly check will increase for every month you wait, up until age 70. You’ll get an extra 2/3 of 1% for each month you delay after your birthday month, adding up to 8% for each full year you wait until age 70. You stop accumulating delayed retirement credits when you turn 70.
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3. Social Security tax limit
In 2026, the wage cap for Social Security taxes will increase.
Social Security caps the amount of income you pay taxes on and get credit for when benefits are calculated. The Social Security tax limit in 2025 is $176,100, up $7,500 from $168,600 in 2024. The tax limit is indexed to inflation and is therefore estimated to rise in 2026.
The 2025 Social Security Board of Trustees Report estimates the maximum taxable earnings limit will be $183,600 in 2026, an increase of $7,500 from the 2025 ceiling of $176,100. The increase in the wage base would translate into owing an extra $465 annually for a total tax of $11,383.20.
Social Security will stop withholding taxes once you reach the maximum income amount for the year. However, there is no cap on Medicare taxes, meaning your total wages are subject to the 1.45% tax.
There is also an additional 0.9% tax for individuals earning over $200,000 per year, $250,000 for married couples filing jointly, or $125,000 for married tax filers filing separately. Employers are responsible for withholding this amount from your paycheck, although they are not required to match it.
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4. Earnings test: you can earn more from work in 2026 while collecting benefits
Continuing to work while collecting Social Security may end up reducing your monthly benefits check. This is due to a rule called the Social Security earnings test. Fortunately, those limits typically rise every year, leaving you more of your monthly Social Security intact.
The Social Security Administration temporarily withholds $1 of a worker’s benefits for every $2 earned over $23,400 in 2025. When you reach full retirement age, the test is more generous — you only forfeit $1 in benefits for every $3 in 2025 earnings above $62,160. Once you reach your FRA, there is no limit on earnings for the remainder of the year, and any withheld benefits are restored.
For beneficiaries younger than Full Retirement Age (FRA) throughout the year: The estimated annual earnings limit is $24,360. $1 in benefits will be withheld for every $2 earned above this limit.
For beneficiaries reaching FRA in 2026: The estimated annual earnings limit is $64,800. $1 in benefits will be withheld for every $3 earned above this limit until the month the beneficiary reaches FRA.
For beneficiaries reaching FRA in 2026: The estimated annual earnings limit is $64,800. $1 in benefits will be withheld for every $3 earned above this limit until the month the beneficiary reaches FRA.
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5. Earning Social Security credits in 2026
In 2025, you have to earn more to qualify for Social Security credits.
You must earn a minimum number of Social Security credits to qualify for retirement benefits. The Social Security Administration cannot pay you benefits if you don’t have enough credits. You must earn 40 work credits to become eligible for benefits, and you are allowed to earn up to four credits per year.
The SSA also uses the number of credits you’ve earned to determine your eligibility for retirement or disability benefits, Medicare, and your family’s eligibility for survivor benefits.
To earn one credit in 2025, you must have wages and self-employment income of $1,810, and you must earn $7,240 to get four full credits. This amount increases annually, so it will rise in 2026. In 2024, you only needed to earn $1,730 to earn a credit, $80 less than what you need to earn in 2025.
Once you earn the 40 credits, earning more credits won’t increase your benefit payment. Instead, your retirement benefit is based on how much you earned during your working years.
6. The Social Security Trust Fund will be seven years away from facing insolvency
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In Greek mythology, Icarus ignored the wise counsel of his father, flew too close to the sun with his wings made of wax, and suffered the consequences. Today, politicians are ignoring the flashing red lights and increasingly dire insolvency predictions from the Trustees Report and have only acted to hasten the depletion.
How? By increasing benefits for some with the passage of the Social Security Fairness Act (SSFA) and depriving the fund of tax revenue through the new senior deduction included in the One Big Beautiful Bill (OBBB). The deduction will lower the taxable income for some seniors, which can in turn decrease the amount of income tax they pay on their Social Security benefits.
From 2024 to 2025, the date of insolvency has moved up moderately, and the likely reduction in benefits that would be triggered by an insolvency has increased. The reduction in benefits could trigger a 23% cut that would require future beneficiaries to save almost $150,000 to cover the shortfall; aspiring Gen X retirees would need to sock away an additional $701 a month. The longer the issue is ignored, the more drastic the solutions will have to be.
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Preparing for 2026
Since the start of President Trump’s second term and DOGE’s audit of the SSA, the Social Security program and bureaucracy have come under intense scrutiny. Since the confirmation of the new commissioner, Frank Bisignano, things have quieted down. However, for 2026, there are still concerns about how tariffs will impact Social Security and Medicare funding and the cost of imported medications and equipment.
For more information about the 2026 changes to benefits, read:
Seven Medicare Changes Coming in 2026
Medicare Premiums 2026: Projected IRMAA Brackets and Surcharges for Parts B and D
Higher Health Costs in 2026: A Look at Projected Medicare Premiums