Prepared by Public Affairs 312-751-4777
In addition to the retirement annuities payable to employees, the
Railroad Retirement Act, like the Social Security Act, also provides
annuities for the spouses of retired employees. Payment of a spouse annuity is
made directly to the wife or husband of the employee. Divorced spouses may also
qualify for benefits.
The following questions and answers describe the benefits payable to spouses and
the eligibility requirements.
1. How are railroad retirement spouse
annuities computed?
Regular railroad retirement annuities are computed under a two-tier formula. The
spouse annuity formula is based on certain percentages of the employee's tier I
and tier II amounts.
The tier I portion of an employee’s annuity is based on both railroad retirement
credits and any social security credits that the employee also earned. Computed
using social security benefit formulas, an employee’s tier I benefit
approximates the social security benefit that would be payable if all of the
employee’s work were performed under the Social Security Act.
The tier II portion of the employee’s annuity is based on railroad retirement
credits only, and may be compared to the retirement benefits paid over and above
social security benefits to workers in other industries.
The first tier of a spouse annuity, before any applicable reductions, is 50
percent of the railroad employee’s unreduced tier I amount. The second tier
amount, before any reductions, is 45 percent of the employee’s unreduced tier II
amount.
2. How does a railroad retirement spouse
annuity compare to a social security spouse benefit?
The average annuity awarded to spouses in fiscal year 2007, excluding divorced
spouses, was $910 a month, while the average monthly social security spouse
benefit was about $368.
Annuities awarded in fiscal year 2007 to the spouses of employees who were of
full retirement age or over and who retired directly from the rail industry with
at least 25 years of service averaged $952 a month; and the average award to the
spouses of employees retiring at age 60 or over with at least 30 years of
service was $1,192 a month.
3. What are the age requirements for a
railroad retirement spouse annuity?
The age requirements for a spouse annuity depend on the employee’s age and date
of retirement and the employee’s years of railroad service. The following
requirements apply if the employee’s annuity began
after 1974.
If a retired employee with 30 or more years
of service is age 60 and receiving an annuity, the employee’s spouse is
also eligible for an annuity the first full month the spouse is age 60. Certain
early retirement reductions are applied if the employee first became eligible
for a 60/30 annuity July 1, 1984, or later and retired at age 60 or 61 before
2002. If the employee was awarded a disability annuity, has attained age 60 and
has 30 years of service, the spouse can receive an unreduced annuity the first
full month she or he is age 60, regardless of whether the employee annuity began
before or after 2002 as long as the spouse’s annuity beginning date is after
2001.
If a retired employee with less than 30
years of service is age 62 and receiving an annuity, the employee’s
spouse is also eligible for an annuity the first full month the spouse is age
62. Early retirement reductions are applied to the spouse annuity if the spouse
retires prior to full retirement age. Full retirement age for a spouse is
gradually rising to age 67, just as for an employee, depending on the year of
birth. Reduced benefits are still payable at age 62, but the maximum reduction
will be 35 percent rather than 25 percent by the year 2022. However, the tier II
portion of a spouse annuity will not be reduced beyond 25 percent if the
employee had any creditable railroad service before August 12, 1983.
4. What if the spouse is caring for a child
of the retired employee?
A spouse of an employee receiving an age and service annuity (or a spouse of a
disability annuitant who is otherwise eligible for an age and service annuity)
is eligible for a spouse annuity at any age if caring for the employee’s
unmarried child, and the child is under age 18 or the child became disabled
before age 22.
5. What are some of the other general
eligibility requirements?
The employee must have been married to the spouse for at least one year, unless
the spouse is the natural parent of their child; the spouse was eligible or
potentially eligible for a railroad retirement widow(er)’s, parent’s or disabled
child’s annuity in the month before marrying the employee; or the spouse was
previously married to the employee and received a spouse annuity. However,
entitlement to a surviving divorced spouse, surviving divorced young mother
(father), or remarried widow(er) annuity does not waive the one-year marriage
requirement.
6. Are spouse annuities subject to offset
for the receipt of other benefits?
The tier I portion of a spouse annuity is reduced for any social security
entitlement, regardless of whether the social security benefit is based on the
spouse's own earnings, the employee's earnings or the earnings of another
person. This reduction follows principles of social security law which, in
effect, limit payment to the higher of any two or more benefits payable to an
individual at one time.
The tier I portion of a spouse annuity may also be reduced for receipt of any
Federal, State or local pension separately payable to the spouse based on the
spouse’s own earnings. The reduction generally does not apply if the employment
on which the public service pension is based was covered under the Social
Security Act throughout the last 60 months of public employment. (This 60-month
requirement is being phased in over a five-year period ending March 1, 2009, and
there are some exceptions.) Most military service pensions and payments from the
Department of Veterans Affairs will not cause a reduction. For spouses subject
to the public service pension reduction, the tier I reduction is equal to 2/3 of
the amount of the public service pension.
In addition, if the employee was first eligible for a railroad retirement
annuity and a Federal, State or local government pension after 1985, there may
be a reduction in the employee’s tier I amount for receipt of a public pension
based, in part or in whole, on employment not covered by social security or
railroad retirement after 1956. If the employee’s tier I benefit is offset for a
noncovered service pension, the spouse tier I amount is 50 percent of the
employee's tier I amount after the offset.
The spouse tier I portion may also be reduced if the employee is under age 65
and is receiving a disability annuity as well as worker’s compensation or public
disability benefits.
While these offsets can reduce or even completely wipe out the tier I benefit
otherwise payable to a spouse, they do not affect the tier II benefit
potentially payable to that spouse.
7. Under what conditions can the divorced
spouse of a rail employee receive a spouse annuity?
A spouse annuity may also be payable to the divorced wife or husband of a
retired employee if their marriage lasted for at least 10 consecutive years,
both have attained age 62 for a full month, and the divorced spouse is not
currently married. (Effective August 17, 2007, a divorced spouse can receive an
annuity even if the employee has not retired, provided they have been divorced
for at least 2 years, the employee and spouse are at least age 62, and the
employee is fully insured under the Social Security Act using combined railroad
and social security earnings.)
The amount of a divorced spouse’s annuity is, in effect, equal to what social
security would pay in the same situation (tier I only) and therefore less than
the amount of the spouse annuity otherwise payable. The average divorced spouse
annuity awarded in fiscal year 2007 was $491.
8. Would the award of an annuity to a divorced
spouse affect the monthly annuity rate payable to a retired employee and/or the
current spouse?
No. If a divorced spouse becomes entitled to an annuity based on the employee’s
railroad service, the award of the divorced spouse’s benefit would not affect
the amount of the employee’s annuity, nor would it affect the amount of the
railroad retirement annuity that may be payable to the current spouse.
9. What if a husband and wife are both
railroad employees?
If both the husband and wife are qualified railroad employees and either had
some railroad service before 1975, both can receive separate railroad retirement
employee and spouse annuities, without a full dual benefit reduction. If both
the husband and wife started railroad employment after 1974, the amount of any
spouse or divorced spouse annuity is reduced by the amount of the employee
annuity to which the spouse is also entitled.
10. Are railroad retirement annuities
subject to garnishment or property settlements?
Certain percentages of any railroad retirement annuity (employee, spouse or
survivor) may be subject to legal process (i.e., garnishment) to enforce an
obligation for child support and/or alimony payments.
Also, with the exception of the tier I portion of a railroad retirement annuity,
all other portions of an employee’s
annuity are subject to court-ordered property settlements in proceedings related
to divorce, annulment or legal separation.
11. How can a person get more information
about railroad retirement spouse annuities?
For more information and/or a benefit estimate, a person should contact the
nearest office of the Railroad Retirement
Board (RRB). Most RRB offices are open to the public from 9:00 a.m. to 3:30
p.m., Monday through Friday, except on Federal holidays.
Persons can find the address and phone number of the RRB office serving their
area by calling the automated toll-free RRB
Help Line at
1-800-808-0772. They can also get this information from the agency’s Web site at
www.rrb.gov.
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