4 Social Security Rules That Changed This Year
Written by
Jennifer Taylor
Edited by
Zuri Anderson
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A few new Social Security rules have been introduced in 2025. If you’re one of the nearly 69 million Americans that receive these benefits, keeping tabs on the latest happenings is essential.
This will ensure you understand what’s behind any changes to your benefits this year — i.e., increases — and know how to properly file your taxes. Keep reading to learn about four Social Security changes that have been implemented in 2025.
Implementation of the Social Security Fairness Act
A major win for millions of Americans, the Social Security Fairness Act became a law on Jan. 5, 2025. The Act abolished the Windfall Elimination Provision and the Government Pension Offset, which lowered or eliminated Social Security benefits for those who receive a pension from work not covered by Social Security — i.e., they didn’t pay Social Security taxes.
Some of the professions that may receive a benefit hike due to the Act include teachers, firefighters and police officers — in a variety of states — federal employees covered by the Civil Service Retirement System and those whose work fell under a foreign Social Security system.
The amount this will increase an eligible person’s benefit varies, according to the Social Security Administration (SSA). Some people may receive more than $1,000 extra per month, while others only realize a slight increase.
Maximum Taxable Earnings Increase
In 2025, the Social Security maximum taxable earnings increased to $176,100. This marks a 4% increase from the 2024 limit of $168,600.
Cost of Living Adjustment
Social Security recipients received a 2.5% cost of living adjustment (COLA) in 2025. This increase appeared in payments starting in January 2025.
That same month, the average monthly Social Security retirement benefit was $1,976, according to the SSA. Do note, this average changes on a monthly basis.
Social Security benefits comprise approximately 31% of the income of the over 65 population, per the SSA. Therefore, a COLA is important, to help this group keep up with inflation.
No Federal Income Tax on Benefits for Most Recipients
As part of President Trump’s “One Big Beautiful Bill,” 90% of Social Security recipients are now exempt from paying taxes on their benefits. This allows them to keep more of their hard-earned money, instead of having to hand it over to Uncle Sam.
Specifically, the bill allows seniors age 65 and older to claim an extra tax deduction of $6,000 — in addition to the current existing additional standard deduction for seniors, according to the IRS. Each individual senior can claim the $6,000 deduction, meaning eligible married couples are able to claim $12,000.
This deduction applies to individual taxpayers with a modified adjusted gross income up to $75,000 or $150,000 for joint filers. This deduction is in effect from 2025 through 2028.
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