Social Security COLA 2027: 3.6% Increase

SSDI benefits get the same 3.6% increase as retirement benefits, in the same January 2027 payments. SSA estimates the average benefit for all disabled workers rises from $1,642 to $1,701 a month (+$59), and for a disabled worker with a spouse and one or more children from $2,970 to $3,077 (+$107).

Work limits for people on disability also rise in 2027. Earning more than the substantial gainful activity (SGA) amount can end eligibility, and a trial work period month counts when earnings pass the threshold.

If you get both SSDI and SSI, the raise is smaller than 3.6% of the two combined: SSDI counts as income for SSI (20 CFR 416.1121(a)), so as your SSDI rises your SSI falls. For example, with $800 of SSDI and $214 of SSI, the SSDI becomes $828.80 and the SSI about $220, so the two together rise by about $35, roughly the $35 increase in the SSI federal payment standard (an illustration that ignores other income and state supplements). Medicare premiums are taken from SSDI too; see the Part B section.

The federal SSI payment standard rises 3.6%: $1,029 a month for an individual and $1,544 for a couple. SSA says the January payment is always made at the end of the previous December when January 1 is a holiday, so SSI recipients see the new amount at the end of December 2026. Resource limits stay at $2,000 and $3,000. Your own payment depends on income, living arrangement and any state supplement.

Source: SSA, latest COLA and the 2027 fact sheet.

The Social Security tax limit, officially the maximum taxable earnings, is $192,300 in 2027, up from $184,500. You pay the 6.2% Social Security tax only on wages up to that amount, so the most an employee pays is about $11,922.60 in 2027 (6.2% of $192,300, our arithmetic) versus $11,439 in 2026. The 1.45% Medicare tax has no limit. A quarter of coverage takes $1,970 of earnings in 2027.

If you claim retirement benefits before full retirement age (FRA) and keep working, SSA withholds part of your benefits when your earnings pass a limit. Under FRA all year, the 2027 limit is $25,560 ($2,130 a month) and SSA withholds $1 for every $2 above it. In the year you reach FRA, the limit is $67,920 ($5,660 a month) and SSA withholds $1 for every $3 above it, counting only earnings in the months before the month you reach FRA. From the FRA month on, there is no earnings test.

Example under FRA. You are 63 and earn $40,000 in 2027. That is $14,440 over $25,560, so $7,220 of benefits is withheld.

Example in the year you reach FRA. You earn $80,000 before your FRA month. That is $12,080 over $67,920, so about $4,026.67 is withheld.

Most people have the Part B premium deducted from their Social Security payment, so the deposit changes by the COLA minus any premium increase. The standard Part B premium is $202.90 in 2026. CMS has not yet announced the 2027 Part B premium. The 2026 Medicare Trustees Report projects $209.50, which is an estimate, not an official amount. If that estimate holds, a $2,095 benefit grows by $75.40 before Medicare and the premium takes about $6.60 of it.

A hold-harmless rule in 42 U.S.C. 1395r(f) generally keeps a premium increase from lowering the benefit you receive below what you got the month before. It applies only if you received benefits for both November and December, your premium is deducted from your benefit in December and January, and your premium is not adjusted for income (IRMAA) or for new enrollment. It does not help people who pay Part B directly or whose state pays the premium. The calculator above lets you enter the premium you expect. Details and the CMS announcement timeline are on Medicare Part B premium 2027, and higher earners can check IRMAA brackets 2027.

By law (42 U.S.C. 415(i)), the COLA is the percentage increase in the CPI-W, the Consumer Price Index for Urban Wage Earners and Clerical Workers, from the third-quarter average of the last year a COLA took effect to the third-quarter average of the current year, rounded to the nearest tenth of a percent. If there is no increase, or it rounds to zero, there is no COLA, and the base stays where it was. The last COLA took effect in 2025, so the base is the third quarter of 2025.

(328.746 − 317.265) ÷ 317.265 = 3.62% (our arithmetic), which rounds to 3.6%. The CPI-W averages and the 3.6% result are SSA's own, from its latest COLA page. SSA rounds the quarterly averages to three decimals, and rounded them to one decimal for COLAs through 2006.

Our method reproduces 41 of the 42 automatic COLAs from December 1985 to December 2026 exactly. SSA lists 1999 as 2.5%, "effectively" so under Pub. L. 106-554 (sec. 1(a)(7), enacting H.R. 5662, title III, sec. 308, which compensated beneficiaries for a 1999 BLS CPI error); the formula gives 2.4%, as SSA originally determined. We check it against the CPI-W values SSA publishes, with no tolerance. Years with no increase (2009, 2010 and 2015) do not move the base, which is why the 2011 and 2016 COLAs are measured against 2008 and 2014.

SSA's published COLAs are listed by the year they took effect: June through 1982, December from 1983. The COLA that takes effect in December 2026 is the 2027 COLA. COLAs from 1975 through 1984 were set under earlier rules: the CPI-W was on a 1967 base, and the 1975 through 1983 COLAs measured different quarters. They are SSA's published values and we do not recompute them (the December 1984 COLA already used the third quarter, but on the 1967-base index). The 1999 COLA was 2.4% under the formula and 2.5% as published; SSA says it is "effectively" 2.5% pursuant to Pub. L. 106-554, whose H.R. 5662 title III, section 308 has OMB compensate beneficiaries for the 1999 BLS CPI error; it does not itself set the percentage.

Source: SSA, cost-of-living adjustments.

Taxable Social Security benefits calculator shows how much of your raise is taxable. VA disability rates 2027 use the same 3.6% COLA. Medicare Part B premium 2027 and IRMAA brackets 2027 cover what Medicare takes from your check. Federal retirees can see the FERS COLA 2027.