S. 4184: Senior Citizens’ Freedom to Work Act of 2026

The bill titled "Senior Citizens’ Freedom to Work Act of 2026" proposes modifications to the Social Security Act to eliminate what is known as the "retirement earnings test." This test currently affects retirees who choose to work while receiving Social Security benefits, as it reduces their benefits based on the amount of money they earn from working. Here are the key changes the bill aims to make:

1. Repeal of the Retirement Earnings Test

The bill seeks to repeal multiple subsections of the existing Social Security Act that set rules governing the retirement earnings test. This means that seniors will no longer face reductions in their Social Security benefits if they decide to work and earn income.

2. Conforming Amendments

After repealing the retirement earnings test, the bill includes various amendments to update other parts of the Social Security Act to ensure consistency. These amendments primarily focus on changing subsection references and ensuring that related provisions reflect the removal of the earnings test.

3. Changes Relating to Other Social Security Provisions

• The bill modifies sections concerning benefits that could be terminated due to deportation, early retirement exemptions, and consideration of earnings for calculating benefits, among others.
• It updates how deductions related to work are applied in the context of both Social Security and the Railroad Retirement Program, which serves similar functions for railroad workers.

4. Application of Changes

The changes made by this bill are set to apply to taxable years that begin after the law is enacted. This means that once the bill is signed into law, it will impact earnings and benefits starting from the next taxable year.

5. Removal of Deductions in the Railroad Retirement Program

The bill also aims to remove the deductions related to earnings for individuals covered under the Railroad Retirement Program. Like the changes in the Social Security Act, this will allow railroad retirees to work without their benefits being reduced based on earnings.

Relevant Companies

• CSX - A major freight rail service provider that could see changes in the workforce dynamics as more retirees may work without fear of losing retirement benefits.
• UNP - Union Pacific Corporation, another leading freight rail operator, which may be similarly affected by changes in the availability of older workers in the rail industry.