The $65,160 Income Limit Some Social Security Recipients Need to Know About
Working while collecting Social Security sounds simple enough, but a little-known earnings rule can quietly shrink your monthly checks before you even realize it applies to you.
This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.
Retirement does not always mean the end of your working years.
Many people continue working after they begin collecting Social Security, whether to earn extra income, stay socially engaged, maintain a sense of purpose, or simply have a reason to get out of the house. A part-time job or consulting arrangement can make retirement more enjoyable while helping you stretch your savings. For many households, that extra paycheck is the difference between a comfortable retirement and a tight one.
If you claim Social Security before reaching your full retirement age (FRA), however, earning too much from work can temporarily reduce your monthly benefits. Social Security enforces an earnings test that limits how much you can make before some of your checks are withheld.
If you will reach FRA at some point in 2026, one number deserves your attention: $65,160.
How Social Security’s earnings test works
The earnings test applies only to people who are collecting retirement benefits before reaching FRA and are still working. Once you hit FRA, the rule disappears entirely. At that point, you could earn $300,000 a year and still receive every dollar of your monthly benefit.
For those who will reach FRA during 2026, the threshold is $65,160, up from $62,160 in 2025. Stay at or below that level and your Social Security checks are untouched. Exceed it and Social Security withholds $1 in benefits for every $3 you earn above the limit, but only until the month you actually reach FRA.
The math is straightforward. If your earnings top the limit by $9,000, Social Security withholds $3,000 in benefits for the year. Because the withholding stops the moment you reach FRA, the impact is always confined to a portion of the year.
For people who are still several years away from FRA, a stricter test applies. In 2026, the lower earnings limit is $24,480, up from $23,400 in 2025. Exceeding that amount triggers a $1 withholding for every $2 earned above the threshold, a significantly steeper penalty. Those who start collecting benefits mid-year also face a monthly version of the test: $5,430 per month in the year you reach FRA, and $2,040 per month in earlier years.
One detail many people overlook: the earnings test counts only wages from a job and net profit from self-employment, including bonuses, commissions, and vacation pay. It does not count pensions, investment income, IRA withdrawals, or other government retirement payments. For retirees whose income comes primarily from those passive sources, the earnings test may not apply at all.
The $65,160 threshold gives most part-time workers and moderate consultants plenty of room to earn without penalty. Those in higher-paying engagements, however, may find themselves bumping against the limit.
Withheld benefits are not forfeited. Once you reach FRA, Social Security recalculates your benefit upward to account for the months that were withheld, and you recoup that money through larger monthly checks going forward.
Should you claim Social Security if you’re still working?
It is a fair question, given that the earnings test can zero out near-term benefits for high earners. The honest answer is that it depends on your specific circumstances.
If you have already reached FRA, the question is simple: there is no earnings test to worry about, so there is no earnings-related reason to delay taking benefits if you have an immediate use for the income.
If you are still below FRA, the calculation requires more thought. Start by estimating your expected wages and how much Social Security might be withheld because of them. Then weigh that temporary reduction against your need for income today. Keep in mind that the average retired worker received about $2,071 per month from Social Security in early 2026, so even a partial benefit can meaningfully supplement other income.
One point often overlooked is the permanent impact of filing early. Claiming before FRA does not just trigger the earnings test; it also locks in a lower monthly benefit for life. For someone born in 1960 or later, with a FRA of 67, filing at the earliest possible age of 62 permanently reduces benefits by 30%. With the 2026 maximum FRA benefit set at $4,152 per month, that reduction amounts to more than $1,200 in monthly income given up permanently. That lasting cost is typically more significant than the temporary withholding from the earnings test.
For people who can only work part-time and genuinely need Social Security to cover their bills, filing makes clear sense. In most of those situations, earnings will fall comfortably beneath the withholding thresholds anyway.
The earnings test is not a reason to avoid claiming Social Security or to stop working. It is a rule to understand so you can plan around any financial impact before it surprises you.
Editor’s note: The maximum monthly Social Security benefit at full retirement age for 2026 has been corrected to $4,152 (sourced from the Social Security Administration), replacing the previously stated figure of $4,207. This pass also added context on what income types count toward the earnings test and the 2026 average retired-worker benefit of $2,071 per month.
Contact [email protected] for any questions or corrections.
Maurie Backman has more than a decade of experience writing about financial topics, including retirement, investing, Social Security, and real estate. Her work has appeared on sites that include The Motley Fool, USA Today, U.S. News & World Report, and Kiplinger.
Prior to becoming a full-time financial writer, Maurie worked in the financial industry trading distressed debt. She then changed course and spent a few years designing electronic toys. After a stint in content marketing and UX, she shifted back into writing and has since covered everything from the housing market to estate planning to Medicare.
When she's not busy writing, Maurie can be found hiking, walking her dogs, driving her kids to their various sports practices and games, and curling up with a good book. She cooks on occasion and bakes way too often.
