By Richard Craver
Hickory Daily Record, N.C.
(TNS)
For residents contemplating whether it’s time to retire—whether early, at their required full time or beyond—they have $1,080 more incentive to say yes.
That’s how much more an individual can earn in 2026 and still not affect their Social Security benefits.
The Social Security Administration raised the annual work earnings limit for 2026 from $23,400 to $24,480 for those under full retirement age.
For those born in 1960 and later, the full retirement age is 67.
For those born from 1943 to 1954, it is age 66, rising to 66 years 2 months for those born in 1955, along with 66 years and 4 months (1956), 66 years and 6 months (1957), 66 and 8 months (1958), 66 and 10 months (1959).
If you make more than $24,480, there is a $1 deduction from benefits for every $2 earned above this threshold.
“When we figure out how much to deduct from your benefits, we count only the wages you make from your job or your net profit if you’re self-employed,” according to the Social Security Administration.
“We include bonuses, commissions and vacation pay. We don’t count pensions, annuities, investment income, interest, veterans benefits or other government or military retirement benefits.”
In the year reaching full retirement age, the Social Security Administration deducts $1 in benefits for every $3 you earn above $65,160, which is $3,000 higher than in 2025.
After reaching full retirement age, there is no additional Social Security Administration reduction no matter how much work earnings is made.
“We only count your earnings up to the month before you reach your full retirement age, not your earnings for the entire year,” according to the the Social Security Administration.
“Beginning with the month you reach that age, your earnings no longer reduce your benefits, no matter how much you earn.”
Any reduced benefits before full retirement age are not gone, but are reimbursed as additional benefits at full retirement age.
AARP said the increases in how much an early retiree can earn in a year is important since “millions of retired people are adjusting to a changing financial environment by unretiring to manage rising living costs.”
“Money is a major reason retirees resume employment,” AARP said.
“Nearly half of older workers surveyed by T. Rowe Price said financial concerns kept them in the labor force.”
AARP said nearly half of retired individuals who reenter the workforce do so “for the social and emotional benefits.”
“Going back to work doesn’t require returning to a former profession, employer or full-time schedule. Very few retirees choose to resume their previous careers,” Judith Ward, a certified financial planner and thought leadership director at T. Rowe Price, told AARP.
“Instead, many decide to explore new fields or take on entirely different roles,” Ward said.
A Motley Fool report on the Social Security benefits changes said “the rate of losing $1 per $2, or $1 per $3, in excess earnings remains the same each year, while the amount you are allowed to earn goes up to account for inflation.
“It may be upsetting to find that you can’t work and collect Social Security without losing some benefits,” according to the report.
“After all, you may want to do some work while partially retiring, and you may not be able to live off money in retirement plans alone.
“If you were counting on double-dipping and bringing home both a paycheck and your full Social Security benefit, discovering that this may not be possible can throw off your retirement planning efforts.”
Motley Fool pointed out the silver lining of the forfeited benefits being added to monthly checks after reaching full retirement age.
“While it may be a financial problem at the time not to get income from both a paycheck and Social Security if you expected full pay from both sources, it can help you out later by giving you higher future benefits,” according to the report.
Bottom line, according to Motley Fool, is “make an informed choice about whether you want to keep collecting paychecks once you’ve hit the work limits, or stop and preserve your full Social Security check.”
______
© 2026 Hickory Daily Record, N.C. Visit www.hickoryrecord.com. Distributed by Tribune Content Agency LLC.
Thanks for reading CPA Practice Advisor!
Subscribe Already registered? Log In
Need more information? Read the FAQs
