The Social Security Administration (SSA) recently announced the Cost-of-Living Adjustment (COLA) for 2026 at 2.8%. The average COLA increase over the past decade has been 2.6%. While this year’s adjustment is lower than 2024’s 3.2%, it still plays a vital role in keeping Social Security and Supplemental Security Income (SSI) benefits aligned with inflation.
For property managers working with Low-Income Housing Tax Credit (LIHTC) and other affordable housing programs, it’s important to understand how this update affects compliance, especially regarding tenant income and eligibility. At Spectrum Enterprises, we’re here to ensure you navigate these updates smoothly and remain compliant.
What Does the 2026 COLA Mean for Affordable Housing?
The COLA is designed to ensure Social Security and SSI benefits keep pace with inflation. This adjustment directly affects income calculations for tenants who receive these benefits, which is a critical part of affordable housing compliance.
Key Dates to Remember
It’s essential to apply the COLA at the correct time to avoid compliance issues. Here are the important dates to keep in mind:
- Social Security Benefits: The 2.8% increase will be reflected in January 2026 payments. These payments are based on December 2025 benefits.
- SSI Payments: The new COLA adjustment for SSI recipients goes into effect on December 31, 2025, due to the way payment schedules work. This is technically for January 2026, but the early payment date can cause confusion, so make sure you don’t adjust tenant income too early.
Why Timing Matters
Applying the COLA too soon or too late can lead to compliance issues. Managers should avoid making adjustments in December 2025 for tenants who receive Social Security or SSI benefits. Income calculations for rent and eligibility must reflect the 2026 COLA starting in January, not before. Misapplying the adjustment could lead to incorrect tenant rent amounts or non-compliance findings during audits.
Spectrum Enterprises Is Here to Help
Understanding when and how to apply the 2026 COLA is crucial for maintaining compliance with affordable housing regulations. At Spectrum Enterprises, we specialize in providing expert guidance on compliance issues, ensuring that your income calculations and tenant records stay up to date and error-free. By staying informed and updating your processes in a timely manner, you can avoid potential penalties or audit flags.
