Working While Receiving Social Security — Will Your Benefits Be Reduced? (2025–2026 Income Limits Explained)
“I’ve started collecting Social Security, but I’m still working part-time. Will this reduce my monthly benefit?”
This is one of the most common concerns among retirees who continue working after claiming benefits.
The short answer is yes — you can work while receiving Social Security, but your age and earned income level determine whether benefits are temporarily adjusted.
1️⃣ When are Social Security benefits adjusted?
Working while receiving Social Security does not automatically reduce your benefits.
The key factor is whether you have reached your Full Retirement Age (FRA).
- Before FRA: Benefits may be temporarily adjusted if earned income exceeds the annual limit.
- Year you reach FRA: A higher income limit applies, and only income earned before FRA is counted.
- After FRA: There is no income limit — benefits are not adjusted regardless of earnings.
This is not a penalty. Any benefits withheld due to earnings are later credited back through a recalculation after FRA.
2️⃣ What are the 2026 income limits?
The Social Security Administration (SSA) announced the official 2026 earnings limits as part of its annual fall update.
- ✔ Included: W-2 wages, net self-employment income
- ❌ Excluded: Interest, dividends, pensions, Social Security benefits, rental income, investment gains
| Category | 2026 Limit | Adjustment Rule |
|---|---|---|
| Under FRA (entire year) | $24,480 | $1 withheld for every $2 over the limit |
| Year you reach FRA | $65,160 | $1 withheld for every $3 over the limit (only income before FRA) |
| After FRA | No limit | No benefit adjustment |
3️⃣ A practical example
- Age: 64
- Status: Receiving Social Security and working part-time
- Earned income: $32,000
- Result: Benefits are temporarily withheld based on the excess over $24,480
- Key takeaway: Withheld benefits are restored through higher monthly payments after FRA
4️⃣ Common misunderstandings
- ❌ “Working cancels my Social Security.”
- ❌ “Withheld benefits are permanently lost.”
- ❌ “Investment income affects the earnings limit.”
5️⃣ Helpful links
6️⃣ Frequently asked questions
- Is this adjustment the same as Social Security taxes?
No. Earnings-based benefit adjustments and Social Security taxation are governed by entirely different rules.
This article is based on U.S. federal rules and is intended for general informational purposes only.
Individual circumstances may vary. Consult a qualified professional before making financial decisions.
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