Retirement Social Security

Getting Social Security and Working? Here Are the 2026 Rules Changes You Must Know

New earnings limits and benefit rules in 2026 could affect how much working retirees keep from their Social Security benefits.

By Adam Palasciano

Edited by Kristy DeSmit

Updated Jan. 17, 2026

Some retirees may continue working well into their 60s, either by choice or necessity. If you want to retire comfortably, understanding how work income interacts with Social Security benefits is critical.

In 2026, updated earnings limits and benefit calculations may affect how much you receive, at least temporarily. Knowing the rules can help you avoid money mistakes and plan more effectively. Even modest earnings can have different implications depending on when you claim benefits.

Here's what working retirees should know about Social Security changes in 2026.

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Social Security earnings test for 2026

Working while collecting Social Security is allowed, but your age and earnings level determine whether benefits are temporarily withheld. If you are under full retirement age (FRA) for all of 2026, you can earn up to $24,480, which is $1,080 more than the $23,400 limit in 2025, without affecting your benefits. For every $2 earned above that threshold, the Social Security Administration withholds $1 in benefits.

The rules ease significantly in the year you reach FRA. If you reach FRA in 2026, you can earn up to $65,160, which is an increase of $3,000 from the 2025 limit, before benefits are reduced. In that case, the SSA withholds just $1 for every $3 earned above the limit. Once you reach FRA, the earnings test no longer applies, and you can earn any amount without reducing benefits.

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Only earned income counts when it comes to the earnings test

The Social Security earnings test applies only to income earned from work. Wages, salaries, bonuses, commissions, and net self-employment income are included when determining whether you exceed the earnings limit. Other income sources — such as pensions, annuities, investment income, interest, dividends, and capital gains — are excluded.

This distinction matters for retirees who rely more on passive income than wages. Someone working limited hours while drawing from investments may stay well below the earnings threshold. Even if earnings exceed the limit, withheld benefits are not permanently lost, which can soften the impact.

Withheld earnings are not lost forever

When benefits are withheld due to excess earnings, the reduction is temporary. Once you reach FRA, the SSA recalculates your benefit to credit months when payments were withheld. This adjustment increases your ongoing monthly benefit to reflect the delayed payments.

In effect, the earnings test functions more like a timing shift than a permanent penalty. However, the higher benefit is spread over time rather than repaid as a lump sum. Understanding this can help retirees weigh whether continued work aligns with short-term cash-flow needs.

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Working longer could increase your future retirement benefits

Social Security benefits are based on your highest 35 years of earnings, not just the minimum years required to qualify. If you have fewer than 35 earning years when you claim benefits, zeros are included in the calculation, which lowers your benefit. Continuing to work can replace a zero or low-earning year with a higher-earning one.

Even modest earnings later in life may improve your average indexed monthly earnings. This could result in a permanently higher benefit, particularly for individuals with career gaps. For some retirees, working longer may provide both immediate income and long-term benefit growth.

Why it's important to delay collecting benefits

Delaying Social Security beyond FRA increases your benefit through delayed retirement credits. For each full year you delay claiming after FRA (age 66 or 67, depending on when you were born), your benefit grows by about 8%, up to age 70.

Higher lifetime benefits can help offset longevity risk and rising living costs. Delaying may not be practical for everyone, but it can significantly boost monthly income for those who can afford to wait. Combining delayed claiming with continued work may strengthen long-term financial stability.

Bottom line

Working while collecting Social Security in 2026 comes with updated earnings limits and rules that can affect short-term cash flow. However, withheld benefits are often temporary, and continued work may increase future payments. Small timing decisions around work and claiming can influence lifetime benefit outcomes.

Understanding how earnings, timing, and benefit adjustments interact can help you make informed choices that better support your overall retirement plan as rules continue to evolve.

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