If you\u2019re collecting Social Security before full retirement age and still working, a new bill could put thousands of dollars back in your pocket each year.<\/p>\n
Rep. Greg Murphy, R-N.C., introduced H.R. 8344<\/a>, the Senior Citizens\u2019 Freedom to Work Act of 2026, which would repeal Social Security\u2019s Retirement Earnings Test (RET). <\/p>\n Sen. Rick Scott, R-Fla., is sponsoring companion legislation in the Senate<\/a>.<\/p>\n Who qualifies<\/p>\n Anyone collecting Social Security before their full retirement age who earns income above current thresholds would qualify.<\/p>\n Under 2026 SSA rules<\/a>, the agency withholds $1 for every $2 earned above $24,480 annually. <\/p>\n Someone earning $34,480 \u2014 just $10,000 over the limit \u2014 loses $5,000 in benefits under the current rule. This proposal eliminates that penalty entirely.<\/p>\n Those reaching full retirement age during 2026 face a higher threshold \u2014 $65,160 \u2014 with $1 withheld for every $3 earned above that limit in the months before their birthday.<\/p>\n The bill would also extend to railroad retirees, eliminating similar earnings-based deductions under the Railroad Retirement Act.<\/p>\n According to the Congressional Research Service<\/a>, roughly 520,000 Social Security recipients \u2014 about 11% of those below full retirement age, out of more than 71 million total beneficiaries \u2014 were subject to the RET as of 2019, the most recent year for which data is available.<\/p>\n The catch<\/p>\n Withheld benefits aren\u2019t gone forever. <\/p>\n The SSA recalculates benefits upward once a recipient reaches full retirement age, crediting months when payments were withheld.<\/p>\n But a Congressional Research Service analysis<\/a> found that a repeal could increase poverty risk for certain groups \u2014 particularly women and recipients aged 80 to 89.<\/p>\n The concern is eliminating the RET could prompt more people to claim benefits at 62, locking in permanent reductions for early retirement. <\/p>\n Because the RET recalculation would no longer exist to offset that reduction later, some recipients \u2014 especially those with lower lifetime benefits who live into their 80s \u2014 could end up worse off in the long run. <\/p>\n What\u2019s next<\/p>\n The real debate is short-term cost \u2014 repealing the RET means paying out more benefits immediately, adding pressure to a trust fund already under strain. <\/p>\n