How do I collect social security and survivor's railroad retirement benefits?
Monthly benefits are available to the surviving spouse or children if the railroad employee was "insured" under the Railroad Retirement Act.
With the exception of one type of lump-sum death benefit, eligibility for survivor benefits depends on whether or not a deceased employee was “insured” under the Railroad Retirement Act. An employee is insured if he or she has at least 10 years of railroad service, or 5 years performed after 1995, and a “current connection” with the railroad industry at the time of retirement or death, whichever occurs first.
Generally, an employee who worked for a railroad in at least 12 months in the 30 months immediately preceding the month his or her railroad retirement annuity begins will meet the current connection requirement. If an employee dies before retirement, railroad service in at least 12 months in the 30 months before death will meet the current connection requirement for the purpose of paying survivor benefits.
If an employee does not qualify on this basis, but has 12 months of service in an earlier 30-month period, he or she may still meet the current connection requirement. This alternative generally applies if the employee did not have any regular employment outside the railroad industry after the end of the last 30-month period which included 12 months of railroad service and before the month the annuity begins or the date of death.
Full or part-time work for a nonrailroad employer in the interim between the end of the last 30-month period including 12 months of railroad service and the beginning date of an employee’s annuity, or the date of death if earlier, can break a current connection.
Self-employment in an unincorporated business will not break a current connection; however, self-employment can break a current connection if the business is incorporated.
Working for certain U.S. Government agencies -- Department of Transportation, National Transportation Safety Board, Surface Transportation Board, National Mediation Board, Railroad Retirement Board, Transportation Security Administration -- will not break a current connection. State employment with the Alaska Railroad, so long as that railroad remains an entity of the State of Alaska, will not break a current connection. Also, railroad service in Canada for a Canadian railroad will neither break nor preserve a current connection.
In some cases, a current connection may be deemed for survivor benefit purposes for employees with 25 years of service who were involuntarily terminated without fault from the rail industry on or after October 1, 1975, and did not thereafter decline an offer of employment in the same class or craft in the rail industry, regardless of the distance to the new position.
Once a current connection is established at the time the railroad retirement annuity begins, an employee never loses it no matter what kind of work is performed thereafter.
If a deceased employee did not have an insured status, jurisdiction of any survivor benefits payable is transferred to the Social Security Administration and survivor benefits are paid by that agency instead of the RRB. Regardless of which agency has jurisdiction, the deceased employee’s railroad retirement and social security credits will be combined for benefit computation purposes.
The tier I amount of a two-tier survivor benefit is based on the deceased employee’s combined railroad retirement and social security earnings credits, and is computed using social security formulas. In general, the survivor tier I amount is equal to the amount of survivor benefits that would have been payable under social security.
December 2001 legislation established an “initial minimum amount” which yields, in effect, a widow(er)’s tier II benefit equal to the tier II benefit the employee would have received at the time of the award of the widow(er)’s annuity, minus any applicable age reduction.
However, such a tier II benefit will not receive annual cost-of-living increases until such time as the widow(er)’s annuity, as computed under prior law with all interim cost-of-living increases otherwise payable, exceeds the widow(er)’s annuity as computed under the initial minimum amount formula.
The average annuity awarded to widow(er)s in fiscal year 2008, excluding remarried widow(er)s and surviving divorced spouses, was $1,625 a month. Children received $1,153 a month, on the average. Total family benefits for widow(er)s with children averaged $3,390 a month. The average annuity awarded to remarried widow(er)s or surviving divorced spouses in fiscal year 2008 was $914 a month.
A widow(er) who received a spouse annuity from the RRB is guaranteed that the amount of any widow(er)’s benefit payable will never be less than the annuity she or he was receiving as a spouse in the month before the employee died.
Under the Railroad Retirement Act, the tier I portion of a survivor annuity is subject to reduction if any social security benefits are also payable, even if the social security benefit is based on the survivor’s own earnings. This reduction follows the principles of social security law which, in effect, limit payment to the highest of any two or more benefits payable to an individual at one time.
The tier I portion of a widow(er)’s annuity may also be reduced for the receipt of any Federal, State or local government pension based on the widow(er)’s own earnings. The reduction generally does not apply if the employment on which the public pension is based was covered under the Social Security Act throughout the last 60 months of public employment. (There are some exceptions to this 60-month requirement.) However, most military service pensions and payments from the Department of Veterans Affairs will not cause a reduction. For those subject to the public pension reduction, the tier I reduction is equal to 2/3 of the amount of the public pension.
A survivor annuitant should notify the RRB promptly if she or he becomes entitled to any such benefits.