Introduction
For millions of Americans who receive Social Security retirement benefits while still working, 2026 brings meaningful changes that make it easier to earn more income without losing as much of your monthly check. The retirement earnings test — the rule that temporarily reduces benefits for those under full retirement age (FRA) who earn above certain limits — has higher income thresholds this year due to annual wage indexing. These adjustments give retirees, especially those in their early 60s or reaching FRA in 2026, more flexibility to stay in the workforce or take on part-time jobs. Whether you’re already collecting benefits or planning when to start, understanding the updated 2026 Social Security earnings limits, withholding formulas, and what happens after FRA helps you maximize income without unexpected reductions. Here’s a clear, up-to-date breakdown of how the rules have changed for working while collecting Social Security in 2026.
7 Key Changes to Working While Collecting Social Security in 2026
- Higher Earnings Limit for Those Under Full Retirement Age All Year If you will be under FRA for the entire year of 2026, you can now earn up to $24,480 annually ($2,040 per month) before any benefits are withheld — an increase from $23,400 in 2025. Above this limit, the SSA withholds $1 for every $2 earned over the threshold. All withheld amounts are later repaid through a higher benefit once you reach FRA.
- Increased Limit for Those Reaching FRA in 2026 If you will reach full retirement age at some point during 2026, the earnings limit before FRA is $65,160 for the months prior to the month you turn FRA — up from $62,160 in 2025. The withholding rate is more generous here: $1 is deducted for every $3 earned above the limit until the month you hit FRA. After you reach FRA, no earnings limit applies for the rest of the year.
- Zero Earnings Limit After Reaching Full Retirement Age Once you hit FRA (typically age 67 for those born in 1960 or later), there is no restriction on how much you can earn while receiving full Social Security retirement benefits. This applies to retirement, spousal, and survivor benefits — you keep 100% of both your earnings and your monthly check.
- Withheld Benefits Are Not Lost — They’re Recovered at FRA Any temporary reductions due to the earnings test are not permanent. When you reach FRA, the SSA automatically recalculates your benefit upward to give you credit for the months of withheld benefits. This results in a higher monthly payment for the rest of your life — a built-in fairness adjustment.
- Only Wages and Self-Employment Income Count The earnings test applies only to earned income — wages from a job or net earnings from self-employment. Pensions, investment income, rental income, interest, dividends, annuities, and withdrawals from 401(k)s or IRAs do not trigger reductions, so passive income remains completely unaffected.
- Special Rule for the Year You Reach FRA In the calendar year you attain FRA, the SSA uses a more lenient test for the months before you reach FRA. You can also receive full benefits for any whole month you are considered “retired,” regardless of annual earnings. After the month you reach FRA, the earnings limit disappears entirely.
- Related 2026 Updates Impacting Workers
- The Social Security taxable maximum earnings cap rises to $184,500 in 2026 (from $176,100 in 2025), meaning higher earners pay the 6.2% payroll tax on more income.
- For SSDI recipients, the substantial gainful activity (SGA) threshold increases to $1,690/month (non-blind) and $2,830/month (blind), allowing more work without risking loss of disability benefits.
Conclusion
The 2026 changes to working while collecting Social Security benefits — mainly higher earnings limits under the retirement earnings test — give retirees and near-retirees more room to earn supplemental income without significant temporary reductions. With limits rising to $24,480 for those under FRA all year and $65,160 for those reaching FRA in 2026, many can work more freely, especially in the year they hit full retirement age. Importantly, any withheld benefits are not lost — they return as a higher monthly payment after FRA. These adjustments reflect rising wages and aim to support flexible retirement transitions in an era of longer working lives and higher costs. To see exactly how the rules apply to your situation, log into your my Social Security account at ssa.gov for personalized earnings limits and benefit estimates, or call the SSA at 1-800-772-1213. Accurate reporting of earnings and timely updates ensure you receive the full benefits you’re entitled to without surprises in 2026.