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Stop, Look & Listen: Railroad Retirement Benefits Q&A

Answers are provided by Robert S. Kaufman

Working While Eligible for Widow's Benefits

(Posted December 1, 1997 (Revised December 6, 2000))

Question 4: My grandmother has a problem with her Railroad Retirement Widow's Benefits. She's 66 and is working full time. The Railroad Retirement Board has told her that, because of her earnings this year, she's not entitled to payments for several months. Is this correct? My grandfather died earlier this year and my grandmother has been receiving benefits for a couple years, first as a "wife" and now as a "widow." Also, if the Railroad Retirement Board is wrong, can we sue them and can we collect interest on any back payments? What if she thinks fraud is involved?

Norman K.
West Palm Beach, FL

Answer: The penalties for working while receiving Railroad Retirement Benefits are different for a wife of a retired railroad worker as opposed to a widow of a deceased worker.

Generally speaking, benefits for both are reduced when annual earnings are $13,500 or higher in 1997,$14,500 in 1998,and $15,500 in 1999,unless the wife or widow is 70 or older. As of January 1, 2000 the earnings restrictions for those between 65 & 69 are eliminated. (When a person is under 65, an even lower amount can trigger loss of payments.) Once a person earnned more than the annual limitation before 2000, $1 in benefits was lost for each $3 earned. For a wife, the reduction was applied to a portion of the benefits, and there usually was still a smaller amount paid. On the other hand, the entire Widow's benefit was subject to reduction.

When your grandmother received benefits as a wife, only part of her benefit was reduced. However, after your grandfather died, she became a widow and all of her benefit can be lost if her annual earnings are high enough. The different rules may have caused your grandmother some confusion.

Once the Railroad Retirement Board is made aware of your grandmother's expected earnings, they may stop her payments for one or more months to avoid overpaying her. A final determination is made early in the following year once the final earnings are available. All beneficiaries are required by law to promptly tell the Railroad Retirement Board when they expect to earn more than allowed. Interest is not added when there are back payments made.

If your grandmother does not agree with the Railroad Retirement Board on how her case has been handled, she can file suit in the United States Court of Appeals after following the agency's 3-step reconsideration and appeals process. To get more information about the reconsideration and appeals process, she should contact the local Railroad Retirement Board office, or write to Mr. Tom Satler, Director of the Bureau of Hearings & Appeals, United States Railroad Retirement Board, 844 N. Rush Street, Chicago, IL 60611-2092. Time is of the essence because you have to normally start the process by requesting reconsideration of the Board's decision within 60 day of the date of the decision letter.

If fraud is suspected, the Board's Inspector General should be contacted immediately. The Inspector General is a Presidental appointee, and is indepedent of the agency. He is responsible for investigating all reports of waste, fraud and abuse.

Robert S. Kaufman

Important notice:

Answers are provided as general guidance on the subjects covered in the question and are not provided as legal advice to the questioner or to readers. Any legal issues should be reviewed by your legal counsel to apply the law to the particular facts of this and similar situations.

The law in this area changes frequently. Answers are believed to be correct as of the posting dates shown. The completeness or accuracy of a particular answer may be affected by changes in the law (statutes, regulations, rulings, court decisions, etc.) that occur after the date on which a particular Q&A is posted.

Copyright 1997-2017 Robert S. Kaufman
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