Several rules changed this year, and a few more take effect in 2027, that touch your income, your taxes, and the way you give. Most come from the tax law passed in July 2025, known as the One Big Beautiful Bill Act.
Not every change applies to everyone. Here is a plain-English guide to what matters most for retirees and their families -> What's changing for your money in 2026-2027
Social Security and Medicare
Your Social Security check goes up 3.6% in January. The Social Security Administration announced the raise on October 14. For the average retiree, that is about $75 more per month, the biggest raise in four years.
Your take-home raise will be smaller. Medicare premiums usually come out of your Social Security check. The 2026 standard Part B premium is $202.90 a month, and the 2027 amount is typically announced in November. You will get a letter from Social Security in December showing your exact new benefit.
The raise reflects higher inflation, so it keeps pace with prices rather than getting ahead of them.
Medicare open enrollment runs from October 15 to December 7. It is your yearly chance to review your health and drug coverage.
Taxes
If you are 65 or older, you get an extra tax deduction through 2028. It is $6,000 for one person or $12,000 for a married couple, on top of the regular standard deduction. Social Security is still taxable, but this deduction means less of it may be taxed.
The deduction shrinks at higher incomes, so how much it helps depends on your situation.
A few other changes are worth knowing:
- Lower tax rates are permanent. The 2017 tax brackets no longer expire.
- The state and local tax deduction limit rose. It went from $10,000 to $40,000 for most people who itemize.
- The federal estate tax exemption is higher. It is $15 million per person in 2026.
Giving to charity
The rules for charitable giving changed for everyone, whether you itemize or not.
- If you itemize, only giving above 0.5% of your income is deductible. At $200,000 of income, the first $1,000 you give no longer counts.
- If you take the standard deduction, you can now deduct up to $1,000 (single) or $2,000 (married) in cash gifts to charities. Gifts to donor-advised funds do not qualify.
- If you are 70½ or older, giving straight from your IRA is still a strong option. This is called a qualified charitable distribution. The limit is $111,000 in 2026, and the money never counts as taxable income.
Some people also give every few years instead of every year, often through a donor-advised fund. Doing so can help their giving clear the new 0.5% cutoff.
Saving for retirement
If you or your children are still working, higher earners now have to make their catch-up savings as Roth contributions. This applies to people who earned more than $150,000 from their employer last year and want to save extra in a 401(k) after age 50. Roth means the money goes in after tax. If an employer's plan has no Roth option, those workers cannot make the extra contributions at all.
The savings limits also went up:
- IRA: $7,500, plus $1,100 extra if you are 50 or older.
- 401(k): $8,000 extra for people 50 and older, and $11,250 extra for those age 60 to 63.
Trump Accounts for children and grandchildren
Trump Accounts are a new type of investment account for children under 18, and contributions opened on July 4, 2026. Anyone can add money, up to $5,000 per child per year across all contributors for 2026 and 2027. For children born from 2025 through 2028, the government adds a one-time $1,000.
The money can only be invested in low-cost funds that track broad U.S. stock indexes. If you are thinking of gifting to a grandchild, talk with us first, since the rules for grandparents are still being finalized.
The bigger picture
The extra deduction for people 65 and older ends after 2028, while the lower tax rates are permanent. That makes the next few years a good time to look at moving some money from traditional IRAs to Roth accounts. Paired with giving straight from your IRA, there may be real ways to lower your tax bill.
Not every change applies to everyone, and the details often depend on your income.
This is general information, not tax or legal advice. Please consult your tax professional about your individual situation.
Sources:
https://www.ssa.gov/blog/en/posts/2026-10-14.html
https://www.cbsnews.com/news/social-security-cola-2027-increase/
https://www.gobankingrates.com/retirement/social-security/2026-senior-tax-deduction-social-security-retirement-planning/
https://www.hospicechesapeake.org/2026/03/3-things-to-know-what-the-new-tax-law-means-for-giving/
https://irahelp.com/ira-and-retirement-plan-dollar-limits-increased-for-2026/
https://www.merceradvisors.com/personal-finance/2026-retirement-plan-contribution-limits-and-catch-up-rules/
https://www.joneswalker.com/en/insights/blogs/perspectives/trump-accounts-are-coming-in-july-heres-what-you-need-to-know-now.html