Question 708: When both spouses were railroad employees, is there a limit on
the total annuity they can draw?
Recently I hired an individual who stated that he and his wife were railroad employees and that they could draw a full pension plus half of the other spouse's benefit. I believe he is mistaken. He indicated that the two together would draw $10,000 a month.
I know the rule states that the amount each individual can't draw becomes reinstated in their Tier 2 benefit, but it is not clear to me what that amount would be.
Answer: Your understanding is correct as to how spouse annuities are reduced when a husband and wife are both entitled to an employee annuity, if neither has rail service before 1975.
If either person started rail work before 1975, the normal reduction in Tier 1 for an employee annuity is restored in Tier 2. Therefore both spouses can draw full employee and spouse annuities.
The Railroad Retirement Board reports that the average employee and spouse awarded in 2008 received almost $4,500 a month. So total monthly benefits of $10,000 or more in the case you cited is possible.