Eliminating the Social Security Earnings Limit - MSN.com
A bill has been introduced in Congress that would repeal the “earnings limit” currently in effect on how much you can earn while collecting your Social Security benefits before you reach your full retirement age (FRA). For 2026, the earnings limit is $24,480, and if you go over this limit, Social Security withholds $1 for every $2 you go over. For someone reaching their FRA in 2026, the earnings limit increases to $65,160, and ends in the month you reach your FRA.
Eliminating the earnings limit would make it easier for Social Security beneficiaries under their FRA to earn more money. It would enable them to work more hours without worrying about their benefits being cut. Some may even reenter the workforce as they don’t have to worry about going over the limit. People working and collecting Social Security before their FRA are one of the most common groups finding themselves overpaid by Social Security and having to pay the money back. You don’t actually lose those payments; when you reach your FRA, Social Security recalculates your benefit amount as if you retired later, equal to the months you didn’t receive any benefits. However, you may find yourself financially strapped during the period your payments are withheld.
Social Security’s earnings test was enacted during the Great Depression when there were not enough jobs to go around. The reasoning behind it was so older Americans would leave the workforce, resulting in jobs being available for the younger workers. The name of the bill is “Senior Citizens’ Freedom to Work Act.’ Click here to read the bill H.R. 8344. This bill has been introduced, but so far has not been passed by the Senate.
Maurie Backman has written an article discussing this bill and the benefits it may provide if passed. To read the full article, click here…
If you have questions about the current Social Security Earnings limit, you may email them to ssadvisor@amacfoundation.org or call an accredited advisor at (888)750-2622. Visit our website for more information on our Social Security Advisory Service.
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