If you’re one of the 70 million Americans receiving Social Security, 2026 is bringing some major updates to your monthly check. Between the much-anticipated COLA increase and a slight jump in Medicare premiums, there’s a lot to keep track of. These changes are fueled by the latest inflation trends and federal policy shifts, and they’ll impact everyone from current retirees to the millions of workers still paying into the system.
COLA and Medicare Premiums
The good news is that Social Security and SSI payments are getting a 2.8% boost for 2026. It’s a bit of a step up from last year’s 2.5% increase, adjusted up for inflation. For the average retiree, that works out to about $56 more per month, bringing the typical social security check from $2,015 up to $2,071 starting in January.
The not so great news? Medicare premiums also increased from $185 to $202.90 per month – a 9.7% increase over last year. That hike in premiums will eat into your COLA by about $17.90 per month. It doesn’t cancel out your COLA raise entirely, but it’s definitely something to account for when you’re planning your budget for the new year.
Paying Social Security Taxes
If you’re still in the workforce, you know that a chunk of your paycheck goes toward funding Social Security. The standard tax rate is staying at 12.4%—usually split 50/50 between you and your employer—but the amount of your income that can be taxed is going up.
For 2026, you’ll pay Social Security taxes on your earnings up to $184,500. Anything you make above that cap is “Social Security tax-free.” It’s also worth noting that “passive” income—like your retirement account withdrawals or investment interest—isn’t touched by this tax at all.
Paying Taxes on Your Social Security Income
Finally, some relief on the tax front! If you’re 65 or older, a major new tax break—part of the “One Big Beautiful Bill” passed last summer—could significantly lower what you owe on your Social Security income in 2026. This new rule allows eligible seniors to take an extra $6,000 deduction ($12,000 for couples!) off their taxable income.
For most, this means keeping more of your check in your own pocket. If you’re a single filer making up to $75,000 or a couple making up to $150,000, you can claim the full amount. Even if you earn more than that, you might still qualify for a partial break. It’s a temporary win (running through 2028), so make sure to take advantage of it while it’s here!
Qualifying for Social Security Benefits
Planning for the future? Think of Social Security credits as your “tickets” to retirement. To qualify for benefits, most people need to collect 40 credits over their working life—which usually takes about 10 years of work.
In 2026, the “price” of a credit is going up slightly to reflect higher wages. You’ll earn one credit for every $1,890 you make. Since you can bank a maximum of four credits per year, you’ll be all set for 2026 once your total earnings hit $7,560. It’s a small milestone that ensures your future benefits stay on track!
For complete details on all changes impacting Social Security in 2026, visit the Social Security Administration website.
