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Program Letter 2014-02
To: Certification Registration, Retirement and Unemployment Contact Officials
Subject: Notice of Annual Rates (2014)
Date: December 6, 2013 View this document in PDF

 
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Prepared by:

Quality Reporting Service Center
Railroad Retirement Board
844 North Rush Street
Chicago, Illinois 60611-2092

Phone: (312) 751-4992
Fax: (312) 751-7123
E-mail: QRSC@rrb.gov

Please distribute this notice to all individuals within your organization who may need the information in connection with their work.

Creditable and Taxable Compensation

The 2014 railroad retirement tax rates and maximum compensation bases are as follows:
  Tax Rate Earnings Base
Employee Tier I 6.2%
$117,000
Medicare 1.45% No Limit
Employer Tier I 6.2% $117,000
Medicare 1.45% No Limit
Employee Tier II 4.4% $87,000
Employer Tier II 12.6% $87,000
Railroad Unemployment Insurance Variable $1,440
Railroad Unemployment Insurance Maximum Variable $1,860

The Tier II tax rates are determined annually from a tax rate schedule based on an average account benefits ratio reflecting railroad retirement fund levels.  Employer tax rates can range from 8.2 percent to 22.1 percent.  Employee tax rates can range from 0 percent to 4.9 percent.

Additional Medicare Tax: Beginning in 2013, employees will pay an additional 0.9 percent Medicare tax on earnings above $200,000 (for those who file an individual return) or $250,000 (for those who file a joint return). This additional HI tax rate is not reflected in the tax rates shown above. For additional information contact the Internal Revenue Service. 

Experience Rating
 
In October 2013, each employer was sent a notice of their 2014 Railroad Unemployment Insurance Act (RUIA) contribution rate.  If you have not received your notice, please contact the Quality Reporting Service Center.

Retirement and Survivor Benefits
 
Exempt Amounts for Annual Earnings Test for Less Than Full Retirement Age Annuitants:   In 2014, the annual exempt amount for less than full retirement age annuitants is $15,480.  The monthly exempt amount for the first year of retirement in 2014 is $1,290.
 
Exempt Amounts for Annual Earnings Test for Full Retirement Age Annuitants: In 2014, the annual exempt amount for full retirement age annuitants is $41,400.  The monthly exempt amount for the first year of retirement in 2014 is $3,450.
 
Cost-of-living Increase: Annuitants will receive a cost-of-living increase effective January 2014. Tier I will increase 1.5% and Tier II will increase by 0.5%. This increase is before adjustment for other benefits.
 
Unemployment and Sickness Benefits
 
Maximum Daily Benefit Rate: Under the Railroad Unemployment Insurance Act (RUIA), the maximum daily benefit rate is equal to 5 percent of the monthly RUIA compensation base, rounded down to the nearest multiple of $1.00.  For days of unemployment and sickness in registration periods beginning on and after July 1, 2014, the maximum daily rate is $70.00.  The maximum rate for registration periods beginning on or after July 1, 2015, is $72.00.
 
Monthly Compensation Base: The monthly compensation base under the Railroad Unemployment Insurance Act for calendar year 2015 is $1,440.
 
Qualifying Base Year Compensation: The amount of base year compensation required in 2014 to qualify for benefits in the benefit year beginning July 1, 2015, is $3,600.00.
 
Compensation of $3,600.00 is also the amount of creditable compensation required to end a voluntary leaving of work disqualification period in months in calendar year 2014.  In addition, remuneration earned in calendar year 2014 from employment covered under the Act cannot be considered subsidiary remuneration if the employee's base year earnings are less than $3,600.00.
 
Maximum Benefits: The monthly amount of base year 2014 compensation that can be counted in determining the maximum amount of normal benefits payable to an employee in the benefit year beginning July 1, 2015, is $1,860.

Maximum Monthly Compensation Base and the Earnings Test: For unemployment registration periods beginning July 1, 2015 and later, no benefits are payable for which the total amount of an employee's earnings and other remuneration from railroad and non-railroad work for days in the period exceeds the monthly compensation amount of $1,440.


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Link to USA.gov: The U.S. government's official web portal. U.S. Railroad Retirement Board
844 North Rush Street
Chicago IL, 60611-2092
Toll Free: (877) 772-5772
TTY: (312) 751-4701
Directory: (312) 751-4300
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Date posted:  12/06/2013
Date updated: 12/06/2013