Do SS recipients have to pay taxes on 2026 payments
Executive summary
For 2026 Social Security payments, recipients may still owe federal income tax on a portion of their benefits depending on “combined income”: up to 85% of benefits can be taxed under current federal rules [1]. Some changes in 2026—new senior tax deductions at the federal level and state-level rollbacks of taxation—will reduce or eliminate tax for many, but federal taxation has not been universally repealed as of early 2026 [2] [3].
1. How federal taxation of benefits still works in 2026
Under the law in effect as of early 2026, Social Security retirement, disability and survivor benefits can be included in taxable income: depending on adjusted gross income plus half of Social Security benefits (the IRS “combined income” test), up to 85% of benefits may be subject to federal tax [1] [4]. Supplemental Security Income (SSI) remains non‑taxable under federal rules [1] [4]. Beneficiaries who expect to owe federal tax can request withholding from monthly checks through the Social Security Administration with predefined withholding options (7%, 10%, 12% or 22%) [1].
2. What changed in 2026 that reduces tax pain for many seniors
A new federal deduction aimed at older taxpayers—variously described as a “senior bonus” or deduction up to $6,000 ($12,000 married filing jointly) for qualifying taxpayers—was introduced for 2026 and can reduce taxable income enough to keep Social Security benefits below the thresholds that trigger taxation for many households [2] [1]. Reporting outlines this deduction as a principal reason millions of older Americans may see their federal tax on benefits materially reduced or eliminated in 2026, though the exact benefit depends on individual filing status and other income [2] [1].
3. The congressional wildcard: a bill that could wipe out federal tax on benefits
Legislation titled the You Earned It, You Keep It Act was under consideration and, if enacted, would eliminate federal income taxation of Social Security beginning with 2026 tax returns (filed in 2027), but as of early 2026 that bill had not become law and therefore had not ended federal taxation [1] [4]. Proponents argue elimination would restore retirees’ purchasing power, while critics note the revenue loss would likely be offset by measures such as raising the payroll tax cap—an implicit tradeoff highlighted in legislative discussion [4].
4. State taxes: most states don’t tax benefits, but several still do
State treatment varies: by 2026 the number of states taxing Social Security is small and shrinking—West Virginia planned to phase out its tax so only seven states would tax benefits in 2026, though exemptions and income thresholds differ widely where taxes remain [3] [5]. Some states offer generous exemptions tied to income levels—Kiplinger reports specific thresholds (for example, $95,000 married/$75,000 single in some states for 2026 rules) that determine whether a retiree’s Social Security is taxed at the state level [5].
5. Practical takeaways and reporting limits
The practical reality in 2026 is mixed: many beneficiaries will pay no federal tax on their benefits because their combined income falls below the IRS thresholds or because they benefit from the new senior deduction, others will still see up to 85% of benefits included in taxable income, and a shrinking set of states may also tax benefits depending on residency and income [1] [2] [3]. This summary is based on published guidance and news reporting through early 2026; confirmation of any recent law changes (for example, final passage of the You Earned It, You Keep It Act or state-level tax repeals after early 2026) requires checking the final text of statutes or state revenue notices because the sources used report the status as of early 2026 rather than subsequent enactments [1] [4] [5].