There are also other changes related to Social Security that could have a big impact next year.
More retirees rely on Social Security: AARP
As the Social Security system turns 90 years old, 65% of retirees rely on it. Surveys show that public confidence in its future continues to decline.
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Social Security is about to celebrate its 10th anniversary. The popular federal program began in 1935, when President Franklin D. Roosevelt signed the Social Security Act. Over the years, there have been some major changes to Social Security, including gradually increasing the full retirement age from 65 to 67.
Further changes to Social Security are on the way. Here are three big things coming in 2026.
1. Cost of Living Adjustment (COLA)
The most important Social Security change next year for beneficiaries is the annual cost of living adjustment (COLA). Last month, the Social Security Administration announced that benefits would increase by 2.8% starting in January 2026. The average Social Security retirement benefit increases by about $56 per month.
This adjustment is larger than the 2.5% increase in 2025. However, it is lower than the average COLA of 3.1% over the past 10 years.
Not everyone is happy with the 2.8% increase. “The 2026 COLA is going to hurt seniors,” said Shannon Benton, executive director of the Senior Citizens League, a nonprofit advocacy group for seniors. Benton and her organization want Congress to modify the way COLAs are calculated to better reflect the costs borne by seniors.
2. Increased income limits for early retirees
Some people continue to work while claiming Social Security retirement benefits before reaching full retirement age. A portion of your income from work may be subject to Social Security retirement income testing.
The Social Security Administration (SSA) deducts $1 from benefits for every $2 earned above the annual limit for people under full retirement age. In 2025, that annual limit is $23,400 ($1,950 per month). However, it increases to $24,800 ($2,040 per month) in 2026.
For individuals who reach full retirement age while continuing to work, the SSA deducts $1 in benefits for every $3 earned above another higher annual limit. In 2025, this earnings limit was $62,160 ($5,180 per month). In 2026, the annual limit increases to $65,160 ($5,430 per month).
3. Increase in the upper limit of taxable income
Another big Social Security change isn’t limited to current beneficiaries. Instead, it applies to high-income working Americans.
The maximum amount of income subject to the Social Security portion of the FICA payroll tax will increase from $176,100 this year to $184,500 in 2026. All employees must pay 7.65% of their salary to fund both Social Security and Medicare. Employers pay each employee the same rate. Self-employed individuals pay both employee and employer FICA taxes (15.3% total).
Income over $184,500 will no longer be subject to FICA taxes in 2026. However, the maximum threshold for taxable income may be raised again in the future.
Another important change related to social security
A 2.8% annual COLA, higher income limits for early retirees, and higher maximum taxable income are the biggest changes to Social Security next year. But there is also another important change related to Social Security.
Medicare Part B premiums are automatically deducted from most individuals’ monthly Social Security benefit payments. The standard monthly Part B premium for 2025 was $185. However, some people may pay higher Medicare Part B premiums if their modified adjusted gross income is higher than the established threshold.
The Centers for Medicare and Medicaid Services (CMS) has not yet released Medicare Part B premium amounts for 2026. However, standard Part B premiums are expected to increase by 11.6% to $206.50. This additional amount will offset much of the COLA that many retirees received.
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