Railroad Retirement Board
Retiree Earnings Limits to Rise -
2012
October 2011
Retiree
Earnings Limits to Rise in 2012
Those railroad retirement annuitants subject to earnings
restrictions can earn more in 2012 without having their benefits reduced, as a
result of increases in earnings limits indexed to average national wage
increases.
Like social security benefits, some railroad retirement benefit
payments are subject to deductions if an annuitant’s earnings exceed certain
exempt amounts. These earnings restrictions apply to those who have not
attained full social security retirement age. For employee and spouse
annuitants, full retirement age ranges from age 65 for those born before 1938
to age 67 for those born in 1960 or later. For survivor annuitants, full
retirement age ranges from age 65 for those born before 1940 to age 67 for
those born in 1962 or later.
For those under full retirement age throughout 2012, the exempt
earnings amount rises to $14,640 from $14,160 in 2011. For beneficiaries
attaining full retirement age in 2012, the exempt earnings amount, for the
months before the month full retirement age is attained, rises to $38,880 in
2012 from $37,680 in 2011.
For those under full retirement age, the earnings deduction is $1
in benefits for every $2 of earnings over the exempt amount. For those
attaining full retirement age in 2012, the deduction is $1 for every $3 of
earnings over the exempt amount in the months before the month full retirement
age is attained.
When applicable, these earnings deductions are assessed on the
tier I and vested dual benefit portions of railroad retirement employee and
spouse annuities, and the tier I, tier II, and vested dual benefit portions of
survivor benefits.
All earnings received for services rendered, plus any net earnings
from self-employment, are considered when assessing deductions for
earnings. Interest, dividends, certain rental income, or income from
stocks, bonds, or other investments are not considered earnings for this purpose.
Retired employees and spouses, regardless of age, who work for
their last pre-retirement non-railroad employer are
also subject to an additional earnings deduction, in their tier II and
supplemental benefits, of $1 for every $2 in earnings up to a maximum reduction
of 50 percent. This earnings restriction does not change from year to
year and does not allow for an exempt amount.
A spouse benefit is subject to reduction not only for the spouse’s
earnings, but also for the earnings of the employee, regardless of whether the
earnings are from service for the last pre-retirement non-railroad employer or
other post-retirement employment.
Special work restrictions continue to be applicable to disability annuitants in
2012. The monthly disability earnings limit increases to $790 in 2012
from $780 in 2011.
Regardless of age and/or earnings, no railroad retirement annuity
is payable for any month in which an annuitant (retired employee, spouse or
survivor) works for a railroad employer or railroad union.
Public Affairs 312-751-4777
Posted: 10/23/11