Archive for the ‘Alumni Association News’ Category

SMART-TD member loses home in fire

On January 9, 2022, tragedy struck in the form of a fire for Alaska Railroad conductor and SMART-TD Local 1626 (Anchorage, Alaska) member Danielle Gallagher. Gallagher and her two children lost their home near Palmer, Alaska, that night, reports Local 1626 Secretary & Treasurer Justin Voss.

Gallagher family

The local has rallied around Gallagher and Alaska SLD and Local Legislative Representative Darren Toppin has set up a GoFundMe account to help her with expenses as the family works to recover from the fire.

“Danielle is a conductor for the Alaska Railroad and a very dedicated employee. She loves her job! Not only is Danielle a great coworker, she is also [a] great friend. She is always willing to reach out and lend a hand and helps anyone in need. No matter the situation,” Toppin said on the GoFundMe page. “This is now our chance to help her and her awesome kids and say, thank you for always having our backs.”

In addition to the loss of their home, some of the family dogs were lost in the fire. The farm animals, including horses and cattle and other livestock, were not harmed.

Click here to make a donation to the fund to help Gallagher and her kids.

 

Dates set for 2022 TD Annual Meeting

Save the date for the TD annual meeting!

SMART Transportation Division is pleased to announce that plans are underway to resume the TD Annual Meetings after a two-year pandemic disruption.

The meeting is scheduled to take place Aug. 8 through 10, 2022, at the San Francisco Hilton Union Square, 333 O’Farrell St., San Francisco, CA 94102. It’s a great opportunity to take part in informative in-person workshops and build camaraderie with fellow union brothers and sisters over the three-day meeting.

Details regarding costs, registration and schedule will be communicated as they are finalized and will be posted on the union website.

Remembering Martin Luther King’s legacy

SMART-TD shares with the late Dr. Martin Luther King Jr. the dream that men and women should be judged not by the color of their skin, their nationality or religious beliefs, but by the content of their hearts.

King’s brilliance, vision, leadership and ultimate personal sacrifice shifted the course of American history by shedding light and bringing hope to a nation marred by racism, ignorance and inequality.

King’s work and his words brought the promise of justice, hope and freedom to people of color and to the oppressed everywhere. His words still ring as powerfully, relevant and true today as they did more than 50 years ago:

“And so even though we face the difficulties of today and tomorrow, I still have a dream. It is a dream deeply rooted in the American dream.

“I have a dream that one day this nation will rise up and live out the true meaning of its creed: We hold these truths to be self-evident, that all men are created equal.

“I have a dream that my four little children will one day live in a nation where they will not be judged by the color of their skin but by the content of their character.”

–- From Martin Luther King’s historic speech delivered Aug. 28, 1963, on the steps of the Lincoln Memorial in Washington D.C.

Read King’s “I Have a Dream” speech in its entirety here.

Watch highlights of King’s speech.

Read an article about King and his connections with labor.

Former VP Donald Carver passes away

Former Vice President Donald Carver, who led the United Transportation Union Yardmasters Department from 1987 until his retirement in 2003, passed away January 11, 2022, one day prior to his 79th birthday, his family announced.

Carver

Brother Carver had a 41-year career on the railroad that began when he hired out in April 1962 as a switchman on the Louisville & Nashville Railroad. He joined UTU predecessor union the Brotherhood of Railroad Trainmen (BRT) in May 1962 before becoming a yardmaster and an officer in the Railroad Yardmasters of America (RYA), rising to general chairperson and a national vice president in the 1970s in that union before its merger with UTU.

In 1987, Carver was elected UTU assistant to the president/yardmasters and he served in that capacity before being elevated to vice president in 2003. In total, 29 of Carver’s 41 years were as a union officer.

The late Jim “J.R.” Cumby, Brother Carver’s immediate successor in leading the Yardmasters Department, wrote a tribute to Carver in an issue of the UTU News published after Carver’s retirement in September 2003:

“Don was an indefatigable road warrior. When the carriers raised the qualifying days worked to seven for carrier-paid insurance, Don went to bat for our part-time officers. With assistance from the negotiating committee, Don ensured all our part-time officers working on the railroad at least one day per month retained carrier-paid insurance benefits,” Cumby wrote in the November 2003 UTU News.

Carver left “some mighty big shoes” to fill in representing the union’s members, Cumby wrote.

Carver’s role with the union hadn’t closed quite yet. In 2004, he served on a blue-ribbon committee to shape union technological efforts for the union as it headed into the 21st century.

After announcing his retirement, Brother Carver closed his final farewell column to the membership with a traditional Irish blessing:

“May the road rise up to meet you, May the wind be always at your back, May the sun shine warm upon your face, And the rain fall soft upon your fields. And until we meet again, may God hold you in the palm of His hand.”

He is survived by his wife of 59 years, Dianna Mae, and two children, the Rev. Dr. Richard Carver Jr. (Stephanie) and Marla Sanders (Chris); five grandchildren; three great-grandchildren; and his brother, David. He was preceded in death by his parents, Rev. Dr. Edward and Alene Carver, and his sister Beth Ostercamp.

A celebration of Brother Carver’s life will take place 12:30 p.m. Monday, Jan. 17, 2022, at Schoppenhorst Underwood & Brooks Funeral Home, 123 Winning Colors Dr., Mt. Washington, Ky. Interment will follow at Bethany Memorial Cemetery, 10917 Dixie Hwy., Louisville.

The SMART Transportation Division offers its sincere condolences to the Carver family, his friends and the union brothers and sisters who knew him.

Click here read Carver’s full obituary or to leave condolences.

TD leadership applauds confirmation of Amit Bose to lead FRA

Amit Bose, who has been serving the Biden administration as acting administrator of the Federal Railroad Administration (FRA) since February 2021, was confirmed Jan. 12 by the U.S. Senate to become full administrator. This was a bi-partisan vote 68-29.

From left, SMART Transportation Division Minnesota State Legislative Director Nick Katich, Michigan SLD Don Roach, Amtrak employee Stefan Schweitzer, then-FRA Deputy Administrator Amit Bose, TD Local 168 (Chicago, Ill.) member Keisha Hamb-Grover and Illinois State Legislative Director Bob Guy stand at Chicago’s Union Station on Oct. 13. Bose was confirmed Jan. 12 as full administrator of the FRA.

Bose’s nomination by President Joe Biden had been put on hold by Republican U.S. Sen. Rick Scott of Florida after it had cleared the U.S. Senate’s Commerce, Science and Transportation Committee on Oct. 20, 2021.

“We are pleased and excited to continue our collaboration with Administrator Bose and the FRA as we press ahead on important safety issues such as regulating freight crew size,” SMART Transportation Division President Jeremy Ferguson said. “Our National Legislative Department and other members of our legislative team have had numerous conversations with Administrator Bose while serving in an acting capacity. We look to build upon the positive relationship that’s been established and on the progress that has been made already, and we congratulate him on his overdue confirmation.”

During his tenure, Bose already has shown that rail labor’s input will be sought, rather than disregarded by FRA. Under the Biden administration, FRA has publicly announced that it plans to reopen the Notice of Proposed Rulemaking (NPRM) regarding the regulation of a minimum freight crew size.

Bose was a guest during the October call of SMART-TD state legislative directors and made it clear that the agency will prioritize cooperative efforts between labor and the federal government such as the Confidential Close Call Reporting System (C3RS), the newly rechartered Rail Safety Advisory Committee (RSAC) and Fatality Analysis of Maintenance-of-way Employees and Signalmen group.

“The lines of communication between labor and FRA have been open ever since his nomination,” National Legislative Director Gregory Hynes said. “We’ve had productive dialogue from the start with Administrator Bose — rail safety is back on the table.”

Bose has years of experience serving in the public sector. He has served two stints as FRA deputy administrator, and has served as FRA chief counsel, USDOT associate general counsel and USDOT deputy assistant secretary for governmental affairs including with former Federal Railroad Administrator and SMART-TD Illinois State Legislative Director Joe Szabo of Local 1290 (Chicago).

In addition to living along the Northeast Corridor in West Windsor, N.J., and working for New Jersey Transit, Bose helped establish and later served on the Northeast Corridor Commission. He also participated in structuring the commission’s cost allocation policy, helped the U.S. Department of Transportation (USDOT) deliver a $2.5 billion Railroad Rehabilitation and Infrastructure Financing (RRIF) loan to Amtrak for its next generation of Acela rail cars, and worked on the environmental review of a number of projects.

Holiday message from TD President Jeremy Ferguson

Brothers and sisters,

One of our organization’s main goals this past year was to take the lead.

We have done that by making progress on numerous fronts — technologically, organizationally and contractually. While the results have not been rapid or easily gained, our focus on the work at hand and our solidarity are helping us to break through. There’s evidence of this in every member with whom I’ve met this year. We are laying the foundation for greatness, one step at a time. It’s a long process, but we all will be proud of the results in the end.

No doubt, the past two years have tested us, but it’s that core concern for each other — the solidarity that unites this union and the labor movement at large — that can overcome all challenges and setbacks. Whatever the future throws at us, it pales in comparison to our collective strength.

This next year will bring more improvements and chances for us to lead — locally, regionally and nationally. There will be more chances to educate, communicate, organize and protect. With your involvement and your support, what we can accomplish is limitless.

Please be safe this holiday season, and remember that, historically, from the week before Thanksgiving to the week after New Year’s Day is the most-dangerous time of the year regarding transportation accidents, injuries and fatalities. Please stay focused and vigilant at work, and let us continue to take care of each other!

The best gift we can give our loved ones during this holiday season is to return home safe, sound and healthy.

God bless all of you, and I wish you and your families a happy holiday season.

Fraternally,

 

 

 

Jeremy Ferguson
President — Transportation Division

RRB: Retirees may need to increase tax withholding at age 62

Certain portions of a Railroad Retirement annuity are treated differently for federal income tax purposes. The following questions and answers explain these differences and address the importance of individuals establishing accurate tax withholding from their annuities. Certain beneficiaries, including those retiring at age 60 with at least 30 years of service, and some occupational disability annuitants, need to pay close attention to changes in tax withholding when they turn age 62.

1. How are annuities paid under the Railroad Retirement Act treated under federal income tax laws?

A Railroad Retirement annuity is a single payment comprised of one or more of the following components, depending on the annuitant’s age, the type of annuity being paid, and eligibility requirements: a Social Security Equivalent Benefit (SSEB) portion of Tier I, a non-Social Security Equivalent Benefit (NSSEB) portion of Tier I, a Tier II benefit and a supplemental annuity.

In most cases, part of a Railroad Retirement annuity is treated like a Social Security benefit for federal income tax purposes while other parts of the annuity are treated like private pensions for tax purposes. Consequently, most annuitants who are U.S. citizens or residents are sent two tax statements from the Railroad Retirement Board (RRB) each January, even though they receive only a single annuity payment each month. While non–resident aliens also receive a single monthly annuity payment from the RRB, they are only sent one tax statement from the RRB.

2. What information is shown on the Railroad Retirement tax statements sent to annuitants in January?

One tax statement, Form RRB-1099 (only sent to U.S. citizens or residents), shows the SSEB portion of Tier I or special minimum guaranty payments made during the tax year, the amount of any such benefits that an annuitant may have repaid to the RRB during the tax year, and the net amount of these payments after subtracting the repaid amount. The amount of any offset for workers’ compensation and the amount of federal income tax withheld from these payments are also shown.

The other tax statement, Form RRB-1099-R (also only sent to U.S. citizens or residents), shows the NSSEB portion of Tier I, Tier II and supplemental annuity paid to the annuitant during the tax year, and may show an employee contribution amount. The NSSEB portion of Tier I along with Tier II are considered contributory pension amounts and are shown as a single combined amount in the Contributory Amount Paid box (Item 4) on the statement. The supplemental annuity is considered a noncontributory pension amount and is shown as a separate item on the statement.

Non–resident aliens are sent one tax statement, Form RRB-1042S, which shows the information included on both Form RRB-1099 and Form RRB-1099-R.

3. Can annuitants request federal income tax withholding from their benefit payments?

Yes. Annuitants may request that federal income tax be withheld from their annuity payments. To add or change federal income taxes withheld from SSEB payments, an annuitant must complete Internal Revenue Service (IRS) Form W-4V, Voluntary Withholding Request, and send it to the RRB. To add or change the amount of federal taxes withheld from NSSEB payments, annuitants must file Form RRB W-4P, Withholding Certificate for Railroad Retirement Payments, (available at the RRB’s website, RRB.gov) and send it to the RRB. If an annuitant does not file a Form RRB W-4P with the RRB and the taxable annuity components exceed the IRS minimum mandatory withholding amount, taxes will automatically be withheld as if the annuitant were married and claiming three allowances. Railroad Retirement benefits are not taxable by any state, so state tax withholding from Railroad Retirement payments is not possible. Annuitants that wish to add or change federal tax withholding from their annuity payments may contact an RRB field office for assistance. While the RRB may provide the necessary forms for withholding, it is the annuitant’s responsibility to determine how much federal income tax withholding is needed. Annuitants are encouraged to discuss the amount of withholding needed with a tax adviser or the IRS.

4. Which Railroad Retirement benefits are treated like Social Security benefits for federal income tax purposes?

The SSEB portion of Tier I – the part of a Railroad Retirement annuity equivalent to a Social Security benefit based on comparable earnings and included on Form RRB-1099 (or Form RRB-1042S for nonresident aliens) – must be reported on an individual’s federal income tax return, and is treated for tax purposes the same way as a Social Security benefit. The amount of these benefits that may be subject to federal income tax, if any, depends on the beneficiary’s income. (To determine if any amount of the SSEB portion is taxable, please refer to IRS publication 915, Social Security and Equivalent Railroad Retirement Benefits.) If part of the SSEB is taxable, how much is taxable depends on the total amount of a beneficiary’s benefits and other income. Usually, the higher that total amount, the greater the taxable part of a beneficiary’s benefit.

5. Which Railroad Retirement benefits are treated like private pensions for federal income tax purposes?

The NSSEB portion of Tier I, Tier II benefits, and supplemental annuities – which are included on Form RRB-1099-R (or Form RRB-1042S for nonresident aliens) – are all treated like private pensions for federal income tax purposes. In some cases, primarily those in which early retirement benefits are payable to retired employees and spouses between ages 60 and 62, some occupational disability benefits, and other categories of unique RRB entitlements, the entire annuity may be treated like a private pension. This is because Social Security benefits based on age and service are not payable before age 62, Social Security disability benefit entitlement requires total disability, and the Social Security Administration does not pay some categories of beneficiaries paid by the RRB.

6. How are 60/30 annuity payments taxed?

A railroad employee with 30 or more years of creditable rail service is eligible for a regular annuity based on age and service the first full month he or she is age 60. The employee’s spouse is also eligible for an annuity the first full month he or she is age 60. These “60/30” annuity payments are taxed as follows:

  • 60/30 annuity payments before the employee or spouse is age 62: All benefits paid to an employee before age 62 are considered NSSEB and are fully taxable and reported on Form RRB-1099-R (or Form RRB-1042S for nonresident aliens). This includes all Tier I and Tier II benefits and any supplemental annuity that might be payable. Spouse benefits are also fully taxable and reported on Form RRB-1099-R (or Form RRB-1042S for nonresident aliens) until both the employee and spouse are age 62.
  • 60/30 annuity payments after the employee is age 62:  Once the employee turns age 62, part of the Tier I benefit is still considered NSSEB, but some is now considered SSEB because equivalent Social Security benefits are payable at age 62. Since these equivalent Social Security benefits paid at age 62 would be reduced for early retirement, while 60/30 benefits are not reduced, the RRB computes the portion of the Tier I benefit comparable to that payable under Social Security, and reports the SSEB amount on Form RRB-1099 (or Form RRB-1042S for nonresident aliens). The SSEB portion of spouse benefits is calculated the same way, except the employee and spouse must both be at least 62 for spouse benefits to be considered SSEB.
  • WARNING for 60/30 annuitants who begin receiving annuities before age 62:  As noted previously, when the employee turns age 62 (or the spouse turns age 62, provided the employee is also at least age 62) the taxability of Tier I benefits changes from all private pension-equivalent benefits to a split between SSEB and NSSEB portions. For many annuitants, this means that the tax withholding in place will automatically decrease, and sometimes this change is significant. This is because any Form RRB W-4P on file with the RRB will not consider the SSEB portion of Tier I in the withholding calculation. In many cases, the SSEB portion will be subject to taxation because of the total amount of the annuitant’s income, and the decrease in withholding may result in an insufficient amount of taxes being withheld. Notices are released to annuitants advising of the change in the withholding amount, and they are encouraged to discuss the issue with a tax adviser or the IRS to determine the correct amount of withholding for them. Annuitants often need to file a new tax withholding election form with the RRB to increase withholding following this change, otherwise they may face a larger tax liability than expected when filing federal income tax returns the following year.

7. Are occupational disability annuitants subject to the same change in tax withholding at age 62?

Those occupational disability annuitants not qualified for a period of disability (also known as a “Disability Freeze”) as defined under the Social Security Act will similarly see the taxability of Tier I benefits change at age 62.

8. Where can an annuitant find more information about the taxability of Railroad Retirement annuities?

More information regarding the taxability of Railroad Retirement benefits can be found in RRB booklets TXB-25, Tax Withholding and Railroad Retirement Payments, and TXB-85, The Taxation of Railroad Retirement Act Annuities. These booklets are available at RRB.gov, or by contacting the RRB toll free at 1-877-772-5772.

Information is also available on the IRS website at www.irs.gov. To learn more about how SSEB payments, repayments and tax withholding amounts should be reported to the IRS, refer to IRS Publication 915, Social Security and Equivalent Railroad Retirement Benefits. For additional information about how pension payments, repayments and tax withholding should be reported to the IRS, or how NSSEB contributory amounts paid are taxed, refer to IRS Publication 575, Pension and Annuity Income, and/or IRS Publication 939, General Rule for Pensions and Annuities.

Railroad Retirement tax rates stable; compensation level subject to taxes increases

The amounts of compensation subject to Railroad Retirement Tier I and Tier II payroll taxes will increase in 2022, while the tax rates on employers and employees will stay the same. In addition, unemployment insurance contribution rates paid by railroad employers will include a surcharge of 3.5 percent, reflecting increased unemployment claims due to the pandemic.

Tier I and Medicare tax — The Railroad Retirement Tier I payroll tax rate on covered rail employers and employees for 2022 remains at 7.65 percent. The Railroad Retirement Tier I tax rate is the same as the Social Security tax, and for withholding and reporting purposes is divided into 6.2 percent for retirement and 1.45 percent for Medicare hospital insurance. The maximum amount of an employee’s earnings subject to the 6.2 percent rate increases from $142,800 to $147,000 in 2022, with no maximum on earnings subject to the 1.45 percent Medicare rate.

An additional Medicare payroll tax of 0.9 percent applies to an individual’s income exceeding $200,000, or $250,000 for a married couple filing a joint tax return. While employers will begin withholding the additional Medicare tax as soon as an individual’s wages exceed the $200,000 threshold, the final amount owed or refunded will be calculated as part of the individual’s federal income tax return.

Tier II tax — The Railroad Retirement Tier II tax rates in 2022 will remain at 4.9 percent for employees and 13.1 percent for employers. The maximum amount of earnings subject to Railroad Retirement Tier II taxes in 2022 will increase from $106,200 to $109,200. Tier II tax rates are based on an average account benefits ratio reflecting Railroad Retirement fund levels. Depending on this ratio, the Tier II tax rate for employees can be between 0 and 4.9 percent, while the Tier II rate for employers can range between 8.2 percent and 22.1 percent.

Unemployment insurance contributions — Employers, but not employees, pay railroad unemployment insurance contributions, which are experience-rated by employer. The Railroad Unemployment Insurance Act also provides for a surcharge in the event the Railroad Unemployment Insurance account balance falls below an indexed threshold amount. The accrual balance of the Railroad Unemployment Insurance Account was negative $46.2 million on June 30, 2021. Since the balance was below zero, this triggered the 3.5 percent surcharge in 2022. There was a surcharge of 2.5 percent in 2021, with no surcharge imposed in 2020.

As a result, the unemployment insurance contribution rates on railroad employers in 2022 will range from the minimum rate of 4.15 percent to the maximum of 12.5 percent on monthly compensation up to $1,755, an increase from $1,710 in 2021.

In 2022, the minimum rate of 4.15 percent will apply to 79 percent of covered employers, with 7 percent paying the maximum rate of 12.5 percent. New employers will pay an unemployment insurance contribution rate of 2.62 percent, which represents the average rate paid by all employers in the period 2018-2020.

RRB: Medicare Part B premiums for 2022

The Centers for Medicare & Medicaid Services (CMS) has announced that the standard monthly Part B premium will be $170.10 in 2022, an increase of $21.60 from $148.50 in 2021. Some Medicare beneficiaries may pay less than this amount because, by law, Part B premiums for current enrollees cannot increase by more than the amount of the cost-of-living adjustment for Social Security (Railroad Retirement Tier I) benefits.

Since the cost-of-living adjustment is 5.9% in 2022, some Medicare beneficiaries may see an increase in their Part B premiums but still pay less than $170.10. The standard premium amount will also apply to new enrollees in the program. However, certain beneficiaries will continue to pay higher premiums based on their modified adjusted gross income.

The monthly Part B premiums that include income-related adjustments for 2022 will range from $238.10 to $578.30, depending on the extent to which an individual beneficiary’s modified adjusted gross income exceeds $91,000 (or $182,000 for a married couple). The highest rate applies to beneficiaries whose incomes exceed $500,000 (or $750,000 for a married couple). CMS estimates that about 7% of Medicare beneficiaries pay the income-adjusted premiums.

Beneficiaries in Medicare Part D prescription drug coverage plans pay premiums that vary from plan to plan. Part D beneficiaries whose modified adjusted gross income exceeds the same income thresholds that apply to Part B premiums also pay a monthly adjustment amount. In 2022, the adjustment amount ranges from $12.40 to $77.90.

The Railroad Retirement Board withholds Part B premiums, Part B income-related adjustments and Part D income-related adjustments from benefit payments it processes. The agency can also withhold Part C and D premiums from benefit payments if an individual submits a request to his or her Part C or D insurance plan.

The following tables show the income-related Part B premium adjustments for 2022. The Social Security Administration (SSA) is responsible for all income-related monthly adjustment amount determinations. To make the determinations, SSA uses the most recent tax return information available from the Internal Revenue Service. For 2022, that will usually be the beneficiary’s 2020 tax return information. If that information is not available, SSA will use information from the 2019 tax return.

Railroad Retirement and Social Security Medicare beneficiaries affected by the 2022 Part B and D income-related premiums will receive a notice from SSA by the end of the year. The notice will include an explanation of the circumstances when a beneficiary may request a new determination. Persons who have questions or would like to request a new determination should contact SSA after receiving their notice.

Additional information about Medicare coverage, including specific benefits and deductibles, can be found at www.medicare.gov.


2022 Part B Premiums

Beneficiaries who file an individual tax return with income:Beneficiaries who file a joint tax return with income:Income-related monthly adjustment amountTotal monthly Part B premium amount
Less than or equal to $91,000Less than or equal to $182,000$0.00$170.10
Greater than $91,000 and less than or equal to $114,000Greater than $182,000 and less than or equal to $228,000$68.00$238.10
Greater than $114,000 and less than or equal to $142,000Greater than $228,000 and less than or equal to $284,000$170.10$340.20
Greater than $142,000 and less than or equal to $170,000Greater than $284,000 and less than or equal to $340,000$272.20$442.30
Greater than $170,000 and less than $500,000Greater than $340,000 and less than $750,000$374.20$544.30
$500,000 and above$750,000 and above$408.20$578.30

The monthly premium rates paid by beneficiaries who are married, but file a separate return from their spouses and who lived with their spouses at some time during the taxable year, are different. Those rates are as follows:

Beneficiaries who are married, but file a separate tax return, with income: Income-related monthly adjustment amountTotal monthly Part B premium amount
Less than or equal to $91,000$0.00$170.10
Greater than $91,000 and less than $409,000$374.20$544.30
$409,000 and above$408.20$579.30

ERMA Lifetime Maximum Benefit to increase in 2022

The lifetime maximum benefit for the Railroad Employees National Early Retirement Major Medical Benefit (ERMA or GA-46000) Plan will increase from $175,700 to $182,700 beginning Jan. 1, 2022.

At the end of 2001, labor and management had agreed on various procedures to administer the annual changes in the amount of the lifetime maximum benefit under the ERMA Plan.

In conjunction with the formula established in 2001, a new lifetime maximum was calculated by utilizing the October 2021 consumer price index (CPI) data for Hospital and Related Services and Physician Services. The result is a lifetime maximum for 2022 of $182,700.

For individuals who have reached the lifetime maximum, the incremental maximum available is applied to eligible expenses submitted for dates of service on or after the effective date of the new maximum. For 2022, this amount will be $7,000.

This change will apply to all railroads and crafts participating in ERMA.

Medicare’s 2022 open enrollment period: October 15 – December 7, 2021

October marks the beginning of Medicare’s open enrollment period for the 2022 coverage year. If you already have Railroad Medicare and want to make a change to your Part D coverage or plan, you can do so between October 15 and December 7, 2021. Any changes you make during open enrollment will take effect January 1, 2022.

This period is the time to reflect on any changes that may have occurred this year, as well as the time to do a little research. You can do this on your own online, but also with a friend you didn’t know you had.

The most common change people face each year is a change to their prescription medicines, either the medicines themselves or the dosages. Be sure to check your plan’s drug formulary, which you should receive in the mail prior to October 15. You can compare available Part D drug plans using the “Find a Medicare plan” online tool at https://www.medicare.gov/plan-compare.

Other changes can be in the types of services that you need. Some may not be covered or covered by Medicare at the same rate as in 2021. You can research this when you receive your Medicare & You Handbook (by mail for some, online for those who have chosen to go paperless). Read the handbook carefully. There is a section called “What’s new & important” that will tell you the most critical things you need to know. The book also explains the different parts of Medicare, including what each part covers. Railroad Medicare is Part B (Medical Insurance) for persons covered under the railroad retirement system.

If you would like to see the Medicare & You Handbook now, you can do so by following this web address: https://www.medicare.gov/Pubs/pdf/10050-Medicare-and-You.pdf.

As for the “friend you didn’t know you had” … sometimes it’s hard to know what type of coverage you need or where to go to look and see what options you have. If this is you, then look no further than your state’s health insurance program. Every state has one, and they are manned by volunteers who have no affiliation with any health insurance programs (including Medicare). Visit the State Health Insurance Assistance Program website at https://www.shiphelp.org/ to find the phone number and website for your local SHIP.

The Railroad Retirement Board has released 2022 Medicare premium information.

In closing, if you have questions about SHIP or your Part B Railroad Medicare coverage, you can call Palmetto GBA’s toll-free Beneficiary Customer Service Line at 800-833-4455, Monday through Friday, from 8:30 a.m. to 7 p.m. ET. For the hearing impaired, call TTY/TDD at 877-566-3572. This line is for the hearing impaired with the appropriate dial-up service and is available during the same hours customer service representatives are available.

We encourage you to visit Palmetto’s Facebook page at https://www.facebook.com/myrrmedicare. Palmetto GBA also invites you to join their email updates list. Just select the ‘Email Update’ link at the top of their main webpage at www.PalmettoGBA.com/RR/Me.


Palmetto GBA is the Railroad Specialty Medicare Administrative Contractor (RRB SMAC) and processes Part B claims for Railroad Retirement beneficiaries nationwide. Palmetto GBA is contracted by the independent federal agency Railroad Retirement Board (RRB), which administers comprehensive retirement-survivor and unemployment-sickness benefit programs for railroad workers and their families under the Railroad Retirement and Railroad Unemployment Insurance Acts.

RRB: Railroad Retirement spouse benefits Q&A

In addition to the retirement annuities payable to railroad employees, the Railroad Retirement Act, like the Social Security Act, also provides annuities for some 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. Information regarding divorced spouses begins with question eight.

1. How are Railroad Retirement spouse annuities computed?

Regular Railroad Retirement annuities are computed under a two-tier formula.

The Tier I portion of an employee’s annuity is based on both Railroad Retirement credits and any Social Security credits that the employee 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 spouse annuity formula is based on percentages of the employee’s Tier I and Tier II amounts. The first tier of a spouse annuity, before any applicable reductions, is 50% of the railroad employee’s unreduced Tier I amount. The second tier amount, before any reductions, is 45% 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 2020, excluding divorced spouses, was $1,130 a month, while the average monthly Social Security spouse benefit was about $744.

Annuities awarded in fiscal year 2020 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 $1,410 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 $1,602 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, date of retirement and years of railroad service.

If a retired employee with 30 or more years of service is age 60 or older, the employee’s spouse is 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 an annuity July 1, 1984, or later and retired at ages 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 or older, the employee’s spouse is 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. The 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% rather than 25% by the year 2022. However, the Tier II portion of a spouse annuity will not be reduced beyond 25% 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 who is 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 a disabled child of any age who became disabled before age 22.

5. What are some of the other general eligibility requirements for a Railroad Retirement spouse annuity?

The employee must have been married to the spouse for at least one year, unless the spouse is the natural parent of their child, or 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.

6. Can the same-sex spouse of a railroad employee file for a Railroad Retirement spouse annuity? 

Yes, if the same-sex spouse meets current spouse annuity eligibility requirements and follows current application procedures.

7. Are spouse annuities subject to offset for the receipt of other benefits?

Yes. 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 government 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. Most military service pensions and payments from the Department of Veterans Affairs will not cause a reduction. Pensions paid by a foreign government or interstate instrumentality will not cause a reduction. For spouses subject to a public service pension reduction, the Tier I reduction is equal to 2/3 of the amount of the public service pension.

In addition, 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 non-covered service pension, the spouse Tier I amount is 50% 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.

8. How do the eligibility requirements and benefits differ for a divorced spouse?

A divorced spouse annuity may 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. A divorced spouse can receive an annuity even if the employee has not retired, provided they have been divorced for a period of not less than two years, the employee and former spouse are at least age 62, and the employee is fully insured under the Social Security Act using combined railroad and Social Security earnings. Early retirement reductions are applied to the divorced spouse annuity if the divorced spouse retires prior to full retirement age. Full retirement age for a divorced spouse is gradually rising to age 67, depending on the year of birth.

A divorced spouse is also eligible for an annuity at any age if caring for the employee’s unmarried child, and the child is under age 18, or a disabled child of any age who became disabled before age 22, if the employee is deceased.

Unlike a regular spouse annuity, the divorced spouse annuity is computed under the single-Tier I formula. 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 (Tier I and Tier II). The average divorced spouse annuity awarded in fiscal year 2020 was $768.

9. 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.

10. What if an employee and spouse/divorced spouse are both railroad employees?

If both 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. If both the employee and spouse 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.

11. Are Railroad Retirement annuities subject to garnishment or property settlements?

Yes. Certain percentages of any Railroad Retirement annuity (employee, spouse, divorced spouse or survivor) may be subject to legal process (i.e., garnishment) to enforce an obligation for child support and/or alimony payments.

Employee Tier II benefits and supplemental annuities are subject to court-ordered property divisions in proceedings related to divorce, annulment or legal separation. (Tier I benefits are not subject to property division.) A court-ordered property division payment may be paid even if the employee is not entitled to an annuity provided that the employee has 10 years of railroad service or five years after 1995 and both the employee and former spouse are at least age 62.

12. How can a person get more information about Railroad Retirement spouse and divorced spouse annuities?

Individuals with questions about Railroad Retirement spouse and divorced spouse annuities can send a secure message to their local RRB office by accessing Field Office Locator at RRB.gov and clicking on the link at the bottom of their local office’s page. If a customer needs to talk to an RRB representative, they can call the agency’s toll-free number (1-877-772-5772) between the hours of 9 a.m. and 3 p.m. each weekday, except Federal holidays. However, customers are asked to be patient because of the increase in call volume due to the closure to the public of RRB offices during the COVID-19 pandemic.