Mon Nov 24 15:10:00 UTC 2025: News Article:
Social Security Recipients to See 2.8% COLA Increase in 2026, but Medicare and Taxes Could Impact Net Benefit
WASHINGTON, D.C. – Approximately 75 million Americans receiving Social Security and Supplemental Security Income (SSI) benefits are slated to see a 2.8% cost-of-living adjustment (COLA) in 2026. The Social Security Administration (SSA) estimates this will add an average of $56 to monthly retirement benefits. Official notices detailing the exact increase and any deductions are being distributed online and via mail.
Beneficiaries should consider how the COLA, the new senior tax deduction, and upcoming Medicare Part B premium hikes may influence their 2026 monthly payments. The federal taxes still apply to the Social Security benefits based on the income. A senior bonus, up to $6,000 is available to qualifying individuals age 65 and over, though this will be applied as a deduction and may not translate to a dollar-for-dollar savings. Eligibility for the deduction phases out for individuals earning $75,000 and married couples with incomes of $150,000.
Making a large impact is the Medicare Part B standard monthly premium, which is set to rise to $202.90 in 2026, a 9.7% increase from $185 in 2025. This increase will impact those earning up to $109,000 individually or $218,000 as a married couple. This premium is typically deducted directly from Social Security checks.
The SSA is encouraging beneficiaries to review their statements carefully and consider adjusting their tax withholdings, or shopping around for more cost-effective Medicare coverage during the open enrollment period, which ends December 7th. This includes exploring options for Medicare Advantage and Part D plans. A Medicare Advantage open enrollment period is also available from January 1 to March 31 for further adjustments.
Financial advisors are emphasizing the importance of proactive tax planning and understanding how these changes will affect individual circumstances.
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