Social Security recipients likely already know that their benefits get a bump almost every year to counteract the effects of inflation. But that cost-of-living adjustment (COLA) is just one of several annual tweaks to the Social Security system.
These changes affect folks who are already retired as well as those who have yet to retire.
Following is a look at what will change in 2026.
1. No more paper checks
The Social Security Administration phased out paper checks for benefits payments in late 2025, so no Social Security beneficiaries will be receiving old-fashioned payments in 2026.
The change affects a small share of those beneficiaries — under 1% — but was part of a broader effort to modernize federal payments. The goal is to improve efficiency and security and save the government money — potentially millions of dollars annually. According to the U.S. Department of the Treasury, issuing a paper check costs about 50 cents while making an electronic funds transfer costs less than 15 cents.
2. Potentially garnished payments
Another change the federal government made in 2025 that affected a small subset of Social Security beneficiaries was resuming forced collections of federal student loans, a practice that had been paused since the COVID-19 pandemic.
When someone defaults on federal student loans, the government can garnish their wages or divert their federal payments, including tax refunds and Social Security benefits.
According to federal estimates, almost 6 million borrowers were in default on their federal student loans when forced collections resumed. They included an estimated 452,000 borrowers who were aged 62 or older and therefore likely receiving Social Security benefits. If these folks are still in default come 2026, they continue to face the possibility of garnished retirement benefits in the new year.
3. The COLA
Social Security recipients will see their monthly benefit payments rise by 2.8% in 2026, a modest increase from the 2.5% bump for 2025.
The new cost-of-living adjustment (COLA) translates to an estimated increase of $56 a month, based on the current average Social Security payment for retired workers. Unfortunately for some folks, the extra income might be offset by higher federal income taxes or Medicare premiums — or both.
4. The Medicare premium offset
The premium for Medicare Part B health insurance coverage is withheld from many retirees’ Social Security benefit payments. As a result, the annual COLA increase to Social Security benefits effectively is offset by the annual increase in Part B premiums.
The standard Medicare Part B premium increase was $10.30 per month for 2025, but the government has yet to announce the premiums for 2026. Whatever your new Part B premium ends up being, though, you can likely count on it offsetting your new Social Security COLA.
5. The earnings limit for working retirees
If you claim Social Security retirement benefits before reaching your full retirement age and also continue working, the Social Security Administration will withhold some of your benefits if your income exceeds what’s known as the earnings limit. (There is no penalty for earnings made while working after you reach full retirement age.)
This earnings limit generally increases annually as the national average wage index increases. For 2026, it will rise:
- From $23,400 to $24,480 if you will reach full retirement age after 2026
- From $62,160 to $65,160 if you will reach full retirement age in 2026
The SSA notes, however, that you do not lose any benefits that are withheld due to your income exceeding the applicable earnings limit. Once you reach your full retirement age, your monthly benefit is increased permanently to account for months in which benefits were withheld.
6. The tax cap on workers’ income
Here’s another annual adjustment based on the increase in average wages: the maximum amount of a worker’s income that is subject to Social Security payroll taxes. It will rise from $176,100 in 2025 to $184,500 in 2026.
So, if you’re fortunate enough to earn more than $184,500 in 2026, you won’t owe Social Security payroll taxes on every dollar you earn.
The Social Security payroll tax rate itself does not change annually. It remains:
- 6.2% for employees (employers pay another 6.2% on their employees’ behalf)
- 12.4% for the self-employed
7. The earnings required for one credit
Not everyone is eligible for Social Security retirement benefits. As we explain in “5 Groups Who Should Not Expect to Receive Social Security Benefits“:
“To receive Social Security retirement benefits, most people need to accumulate at least 40 “credits” during their working lifetime, according to the Social Security Administration (SSA). Currently, you can earn up to four credits per year if you work and pay Social Security taxes. So, it’s perhaps no surprise that infrequent workers — along with immigrants who arrived in the U.S. late in life — make up nearly 90% of the people who have never received benefits, SSA data shows.”
The earnings required for you to receive one Social Security credit, also known as one-quarter of coverage, will rise from $1,810 in 2025 to $1,890 in 2026.
8. The maximum benefit
There is a limit to how much money a retiree can receive in monthly benefits. It’s known as the maximum Social Security benefit.
Your maximum Social Security benefit depends on the age at which you retire. The maximum benefit for someone who retires at their full retirement age will rise from $4,018 per month in 2025 to $4,152 per month in 2026.
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