Biggest Social Security Changes for 2024

Beneficiaries got a rare respite from that offset effect in 2023, as the big COLA was accompanied by a drop in Medicare premiums. But the offset is back in 2024, with the standard monthly Part B rate rising from $164.90 to $174.70, shaving about $10 a month off the COLA gain.

3. Social Security taxes

Social Security benefits are primarily funded by a 12.4 percent tax on most workers’ incomes. If you have a job, you pay half of that rate (via FICA withholding from your paycheck) and your employer covers the rest. If you’re self-employed, you pay both shares as part of your annual tax return.

The rate has been the same since 1990, but the amount of income subject to it changes annually in line with national wage trends. In 2023, you paid Social Security taxes on work income up to $160,200. In 2024, the threshold goes up to $168,600. Earnings above that level are not taxed for the purpose of funding Social Security, nor is any income from investments.

4. Social Security earnings test

If you collect Social Security and continue to work, a portion of your monthly payment may be temporarily withheld. This earnings test applies to people who collect retirement, survivor or family benefits; have not yet reached full retirement age; and have earnings above a certain level.

The threshold changes annually, tracking national wage trends. In 2024, beneficiaries who will not reach FRA until a later year have $1 withheld from their Social Security payment for every $2 in work income above $22,320 (up from $21,240 in 2023).

For example, if you have a $40,000 job, your benefits for the year would be reduced by $8,840 — half the difference between $22,320 and $40,000.

If you will reach FRA in 2024, Social Security withholds $1 in benefits for every $3 in earnings above $59,520 (up from $56,520 in 2023) until the month when you hit the milestone. At that point, the earnings test expires — there’s no longer any work-related deduction, and the SSA adjusts your benefit upward so that, over time, you recoup the prior withholding.

People receiving Social Security Disability Insurance (SSDI) face different income rules. Because SSDI is intended for people who are largely unable to work for an extended period due to a serious medical condition, you can lose it if your earnings reflect what the SSA calls “substantial gainful activity.”

The 2024 threshold for most SSDI beneficiaries is $1,550 a month, up from $1,470 this year. People receiving SSDI on the basis of blindness are subject to a higher income limit: $2,590 a month in the coming year, up from $2,460 in 2023.

5. Qualifying for benefits

You become eligible for retirement benefits by collecting Social Security credits, which you get by doing “covered” work — a job or self-employment in which you pay Social Security taxes on your income. In 2024, you get one credit for earnings of $1,730, $90 more than the 2023 level.

You can earn up to four credits a year, equivalent to $6,920 in work income in 2024. It takes 40 credits, or 10 years of covered work, to qualify for retirement benefits (the 10 years do not need to be consecutive).

You must also compile credits to qualify for SSDI, but the number required can range from six (for a year and a half of work) to 40, depending on how old you are when a medical condition sidelines you from work.