Social Security Wage Base, COLA Set for 2026
The Social Security Administration (SSA) recently announced that individual taxable earnings of up to $184,500 annually will be subject to Social Security tax in 2026. The updated amount is an increase from $176,100 in 2025.
This amount is the wage base limit that applies to earnings subject to the 6.2% OASDI tax (old age, survivors and disability insurance). At or above the wage base limit, employees and employers will each pay $11,439 in tax, an increase of $521 for each.
The Medicare hospital insurance tax of 1.45% each for employees and employers has no wage limit and remains unchanged for 2026. Individuals with earned income of more than $200,000 ($250,000 for married couples filing jointly and $125,000 for married taxpayers filing separately) pay an added hospital insurance tax under Sec. 3103(b)(2) of 0.9% of wages with respect to employment. This is also unchanged for 2026.
The self-employed pay self-employment tax equal to the combined OASDI and Medicare taxes for both employees and employers, 12.4% of net self-employment income up to the OASDI wage base plus 2.9% in Medicare taxes on any amount of net self-employment income, with an offsetting above-the-line income tax deduction of half of the self-employment tax. This is also unchanged.
Additionally, the SSA announced a cost-of-living adjustment (COLA) of 2.8% for both Social Security and Supplemental Security Income (SSI) benefits beginning in January 2026. COLA rose 2.5% a year ago and is based on the consumer price index.
Retirees receiving Social Security benefits will be able to earn $65,160 in the year they reach full retirement age before their benefits are reduced by $1 for every $3 in earnings over the limit in 2026. This amount is an increase from $62,160 in 2025.
Beneficiaries younger than full retirement age can earn up to $24,480 in 2026 before their benefits are reduced by $1 for every $2 in earnings over the limit. This amount is up from $23,400 in 2025.
The maximum Social Security benefit for a worker retiring at full retirement age will increase to $4,152 per month in 2026. In 2025, this amount was $4,018 per month.