Last month we informed that the annual Cost-of-Living Adjustment (COLA) would increase Social Security benefits by 2.8 percent in 2026, but there are other significant changes happening in 2026, including higher Medicare costs and a tax break on Social Security benefits.

When it comes to the COLA increase, the average retired worker will see a monthly benefit of $2,071, the average Social Security Disability Insurance (SSDI) recipient will receive about $1,630 per month, and the average Supplemental Security Income (SSI) recipient will receive a maximum benefit of $994 per month.

Although benefits are increasing, so too will Medicare costs for beneficiaries. The Centers for Medicare and Medicaid recently announced that Medicare Part B, which covers doctor visits and other outpatient care, will increase by 9.7 percent. The monthly cost will go from $185 per month to $202.90. That equates to an annual increase of more than $214.

The COLA increase, compared to Medicare cost increases may seem like a wash to Social Security beneficiaries, but some beneficiaries will also see some additional tax breaks on benefit payments. Beneficiaries age 65 and older will be eligible for a new tax deduction to reduce taxable income by up to $6,000 for beneficiaries.

Greeman Toomey PLLC assists claimant will obtaining Social Security disability benefits. For a free consultation contact us at 612-332-3252.