3 things retirees must know now about Social Security in 2026

Social Security benefits have long provided a source of reliable income for seniors. But while the retirement benefits program offers seniors stability, the rules for retirement benefits themselves are far from stable.

In fact, as a new year fast approaches, it's worth considering what to expect from Social Security in 2026 — especially as some of the news may surprise you.

Here's what every retiree needs to know right now about this retirement benefits program in the upcoming year. 

1. Benefits are increasing

The first big thing to know about Social Security retirement benefits in 2026 is that they are increasing. 

Social Security recipients will receive a 2.8% Cost of Living Adjustment next year. This is a larger COLA than retirees collected last year, but it is one of the smaller raises in the post-pandemic era. 

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Here's what COLAs have looked like in the recent past, according to the Social Security Administration:

• January 2022: 5.9%
• January 2023: 8.7%
• January 2024: 3.2%
• January 2025: 2.5%
• January 2026: 2.8%

A more modest Cost of Living adjustment isn't necessarily a bad thing. 

"COLAs are calculated based on inflation," explained Maurie Backman, a financial writer for The Street who has been writing about Social Security for nearly 20 years. "A higher COLA means prices have increased more year-over-year, which isn't a good thing for seniors who are often on a fixed income."

2. Benefits are still subject to tax

Another thing Social Security recipients need to know is that taxes on benefits have not gone away.

The White House declared victory on President Doland Trump's campaign promise not to tax benefits, with the White House releasing a statement titled "No Tax on Social Security is a Reality in the One Big Beautiful Bill," which touted "Promises made, promises kept."

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However, tax rules on Social Security remain exactly the same as the rules that were in effect before the One Big Beautiful Bill Act. Benefits become partly taxable once:

• Single filers have a provisional income of $25,000 or higher (provisional income is all taxable income, some non-taxable income, and half of  Social Security retirement benefits)
• Married joint filers have a provisional income of $32,000 or higher

No change was made to these thresholds.

The Trump administration created a separate $6,000 deduction per retiree to add to the standard deduction. It's in effect through 2028, and it will reduce tax bills for more seniors overall, but has no direct connection to Social Security and is available even to retirees not yet claiming benefits, if they are within income limits. 

3. More retirees risk having benefits garnished

Unfortunately, some retirees face a looming threat of losing Social Security benefits. That's because the Trump administration has changed some rules on when benefits can be taken.

Specifically, the administration is undoing a change to garnishment rules implemented in the Biden era. Before President Biden changed the rules, up to 100% of Social Security benefits could be garnished if a retiree was overpaid or collected too many benefits in the past due to calculation errors or other issues. 

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Biden limited this to 10%, and the Trump administration aimed to restore the level to 100% in March. However, intense backlash caused the President to walk back this plan — but not all the way back to 10%. 

Now, up to 50% of benefits could be taken from seniors who received previous overpayments, according to reports from the Kaiser Family Foundation.

Retirees could also potentially face garnishment of up to 15% of their benefits if they are delinquent on student loans. Again, garnishment used to be the norm for unpaid student loans, but this rule was suspended during the Covid pandemic. 

The Department of Education announced it would resume collections in May, but then temporarily paused those efforts in June. When it put the pause in place, the DoE indicated an intent to resume collections soon, which could mean in 2026.

So, retirees can expect that although benefits will grow, taxes could still be collected, and there's a greater threat of garnishment now than in the future. Seniors need to know these details, as many rely on Social Security. 

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