As the new year approaches, Americans preparing their finances should be aware of several Social Security changes for 2026.

More than 70 million people across the U.S. receive money from the Social Security Administration (SSA), whether that be in the form on retirement and survivors benefits or disability-related payments. The updates span benefit increases, Medicare costs, tax rules, and earnings limits. Together, they will affect how much beneficiaries receive in the year ahead.

Benefits Increase

A 2.8 percent Cost-of-Living Adjustment (COLA) will take effect in January for Social Security and Supplemental Security Income recipients, increasing monthly payments to help offset higher living expenses.

The SSA estimates that the average retirement benefit will rise from $2,015 to $2,071 per month. For workers who claim benefits at full retirement age, the maximum monthly payment will increase from $4,018 to $4,152. Disability beneficiaries will also see higher payments, with the average Social Security Disability Insurance benefit climbing from $1,586 to $1,630. Although the dollar amounts differ from person to person, the 2.8 percent adjustment applies uniformly.

The COLA also raises the ceiling on total benefits. In 2026, the highest possible monthly Social Security payment will increase from $5,108 to $5,251, amounting to nearly $2,000 more annually for recipients who qualify for the maximum.

Reaching that level requires meeting strict criteria. Eligible individuals must have worked for at least 35 years, with all years counted among their highest-earning, consistently earned at or above the maximum taxable earnings limit, and waited until age 70 to claim benefits. Because few workers meet all of these requirements, only a small number receive the maximum payment, though those who do will see an increase next year.

Medicare Premiums

Medicare costs will rise alongside benefit increases. The Centers for Medicare & Medicaid Services announced on November 14 that the standard monthly premium for Medicare Part B will increase from $185 to $202.90 in January, representing a 9.7 percent jump. A final premium announcement is expected later this fall.

Most Medicare enrollees pay the standard Part B rate, which is typically deducted directly from Social Security payments. As a result, the $17.90 monthly increase will reduce the net impact of the cost-of-living adjustment for many beneficiaries.

New Seniors Tax Deduction

A new tax deduction aimed at older Americans could significantly reduce—or eliminate—taxes on Social Security income for millions of people starting in 2026.

The provision, included in tax and spending legislation passed by Congress in July and known as the “One Big Beautiful Bill,” allows eligible taxpayers to reduce their taxable income by up to $6,000.

To qualify, taxpayers must be at least 65 years old by the end of 2025. Single filers with a modified adjusted gross income of up to $75,000, as well as married couples filing jointly with combined income up to $150,000, are eligible for the full deduction. Reduced deductions are available for single filers earning up to $175,000 and married couples with incomes up to $250,000.

Higher Earnings Subject to Payroll Taxes

Workers contributing to Social Security will also see changes to payroll tax limits. In 2026, the maximum amount of earnings subject to Social Security taxes will increase from $176,100 to $184,500, meaning higher earners may pay payroll taxes on a larger share of their income.

Earnings Test Limits Increase

Income limits that affect people who collect Social Security while continuing to work will rise in 2026, as they typically do each year.

For those who will be under the full retirement age—currently 67—throughout 2026, the annual earnings limit will increase from $23,400 to $24,480. Those who reach their full retirement age during the year will be able to earn up to $65,160 before benefits are reduced, up from $62,160. The earnings test does not apply to anyone who has already reached full retirement age.

Different rules apply to recipients of Social Security Disability Insurance. Because SSDI benefits are intended for people who are largely unable to work for extended periods due to serious medical conditions, exceeding certain income limits can result in a loss of benefits.

In 2026, the threshold for what the SSA considers “substantial gainful activity” will increase to $1,690 per month for most SSDI beneficiaries, up from $1,620 in 2025. Individuals receiving SSDI based on blindness will have a higher limit of $2,830 per month, an increase of $130 from the previous year.

Qualifying for Benefits

Eligibility for Social Security retirement benefits begins with earning at least 40 Social Security credits. Credits are accumulated through work in which Social Security taxes are paid, with a maximum of four credits earned per year. Most workers reach eligibility after about 10 years of employment.

In 2026, one credit will be earned for every $1,890 in wages or self-employment income, an $80 increase from 2025. Workers will earn the maximum four credits per year once their annual income reaches $7,560.