Monthly Social Security and Supplemental Security Income (SSI) benefits will increase 3.6% in 2027, the Social Security Administration announced on October 14, 2026. That is an increase from the 2.8% COLA in 2026. SSA estimates that the average retired-worker benefit will increase by approximately $75 per month.

The 3.6% cost-of-living adjustment (COLA) will begin with Social Security benefits payable in January 2027. Increased SSI payments will begin December 31, 2026.

SSA | Official COLA Information for 2027

SSA | 2027 COLA Fact Sheet

SSA | Historical COLA Increases

Medicare Information

Information about Medicare premium changes for 2027, when announced, will be available at Medicare.gov. For housing income determinations, the applicable amount generally starts with gross Social Security benefits, not the smaller deposit after any Medicare premiums withheld.

COLA Calculation Tutorial

As in our past COLA announcements, let's walk through how to apply the announced increase in common affordable housing income calculations.

Important Points

• Benefit verifications issued before the 2027 announcement generally will not reflect the 2027 COLA. An additional calculation may be needed when the income period and program rules require consideration of the future increase.
• Do not add 3.6% twice. If the documented gross benefit already includes the 2027 COLA, no additional COLA calculation is necessary.
• The type of certification matters. A forward-looking initial income determination and an annual HUD reexamination do not necessarily use the same calculation methodology.

Example #1 | HUD Reexamination Effective January 1, 2027

A family member currently receives $1,500 in gross Social Security benefits each month. A PHA or covered multifamily owner is processing an unfinished annual reexamination effective January 1, 2027.

Annual income calculation:

1. Calculate the COLA: $1,500 × 0.036 = $54.00 monthly increase.
2. Calculate the 2027 gross benefit: $1,500 + $54 = $1,554.00 per month. Alternatively, $1,500 × 1.036 = $1,554.
3. Annualize the new benefit: $1,554 × 12 = $18,648.00.

This follows the type of calculation illustrated in HUD Notice H 2023-10/PIH 2023-27, Attachment B.3, Example B4. It determines this person's Social Security component, not the family's entire income.

Example #2 | Initial Certification Using Anticipated Income

A Social Security recipient expects to move into an LIHTC unit on November 1, 2026. Their gross benefit is currently $1,500 monthly. For this example, assume the applicable initial-certification rules call for projecting payments during the next 12 months.

Annual income calculation:

1. November and December 2026: $1,500 × 2 = $3,000.00.
2. January through October 2027: $1,500 × 1.036 = $1,554 monthly; $1,554 × 10 = $15,540.00.
3. Total anticipated Social Security income: $3,000 + $15,540 = $18,540.00.

Note: This example illustrates a forward-looking 12-month projection when that method is applicable. It is not a substitute for HUD's specific annual-reexamination methodology or an agency's LIHTC verification requirements.

Example #3 | The COLA Is Already Included

A recipient provides an updated benefit notice listing their 2027 gross Social Security benefit as $1,554 per month. Because the figure already incorporates the COLA, do not multiply it by 1.036 again. Use the verified amount according to the applicable income-determination requirements.

HUD Specifics | When Must the 2027 COLA Be Used?

HUD Notice H 2023-10/PIH 2023-27 (Revision 3), Attachment B.3 instructs PHAs and covered multifamily owners to account for the announced Social Security and SSI COLA, beginning the day after SSA's announcement, in annual and interim reexaminations that have not yet been completed and will be effective January 1 or later of the upcoming year.

Because SSA announced the COLA on October 14, 2026, HUD's instruction applies beginning October 15, 2026 to the reexaminations specified in the notice that will be effective January 1, 2027, or later.

This is not a direction to apply the higher amount to every certification with a 2026 effective date, nor does the COLA announcement by itself require an interim reexamination. HUD also notes that the federal SSA COLA does not apply to state-paid disability benefits.

Read the HUD notice, Attachment B.3, including its COLA calculation example.

LIHTC, HOME, and Layered Programs

For an LIHTC property or a HOME-funded property, the new COLA may be a known future change relevant to an income determination. However, the program rules, certification type, and applicable monitoring-agency guidance determine how the increase is treated. HUD's specific timing instruction for annual and interim reexaminations should not automatically be imported into every LIHTC or HOME certification.

At layered properties, document how Social Security income was determined for each applicable program. Also remember that the 3.6% COLA is not a 3.6% increase in LIHTC, HOME, or HUD income limits; those limits are separately established.

Action Steps for Compliance Teams

• Review unfinished HUD annual and interim reexaminations effective in 2027 for application of the new COLA.
• Identify the benefit year on verification documents and avoid applying the COLA twice.
• Update calculation worksheets to 3.6%, checking gross benefits where applicable.
• For LIHTC, HOME, and layered properties, confirm the appropriate income methodology before finalizing a certification.

Primary sources: SSA COLA Information; SSA's October 14, 2026 Announcement; 2027 SSA COLA Fact Sheet; HUD Notice H 2023-10/PIH 2023-27 (Revision 3), Attachment B.3.

This article is provided for regulatory compliance education. Apply the requirements of the governing housing program and applicable agency guidance.