If it appears you may be entitled to an annuity unpaid at death, please read this part of the booklet thoroughly. It will provide information which you will need to understand annuities unpaid at death.

Definition Of An Annuity Unpaid At Death

An annuity unpaid at death is any annuity payments which were due a railroad retirement annuitant and, for any reason, were not paid before the annuitant died. This includes any check which was returned to the RRB because the annuitant died before cashing it. An annuity unpaid at death is taxable for Federal income tax purposes. For further information concerning the taxability of an annuity unpaid at death, refer to the booklet TB-85 Information About the Taxation of Railroad Annuities.

There are two types of unpaid annuities.

• A retirement annuity unpaid at the death of the retirement annuitant; and
• a survivor annuity unpaid at the death of a survivor annuitant.

The application for either type of unpaid annuity must be filed by the second anniversary of the annuitant's death to whom the annuity was originally payable.

People Eligible To Receive A Retirement Annuity Unpaid At Death

An unpaid retirement annuity is paid according to these priorities:

• Widow(er) if he or she was living with the annuitant at the time of death. If there is no qualified widow(er), the unpaid annuities can be paid to:
• the person(s) who paid the employee’s burial expenses. If more than one person paid the burial expenses, each person will receive a share of the unpaid annuities in proportion to the burial expenses which each person paid. However, no person will receive more than the actual amount of burial expenses that the person paid.

Annuities unpaid at the employee’s death cannot be paid to a funeral home. Therefore, unless there is a widow(er) entitled to receive the unpaid annuities, all burial expenses must be paid before the unpaid annuities can be paid.

If all the burial expenses have been paid, or if the amount of the unpaid annuities is greater than the amount of the unpaid burial expenses, the unpaid annuities (or whatever portion remains) can be paid to:

3. the employee’s children. If no children survive the employee, the unpaid annuities can be paid to:
4. the employee’s grandchildren. If no grandchildren survive the employee, the unpaid annuities can be paid to:
5. the employee’s parents. If no parents survive the employee, the unpaid annuities can be paid to:
6. the brothers and sisters of the employee.

If there is more than one person in the category of people to whom the unpaid annuities are paid, the unpaid annuities will be split equally among all the qualified people in the category.

People Eligible To Receive A Survivor Annuity Unpaid At Death

An unpaid survivor annuity is paid only to the relatives of the employee according to the following priorities:

1. The widow(er) of the employee who was living with the employee at the time of death. If there is no qualified widow(er), the unpaid survivor annuities can be paid to:
2. the employee’s children. A step-child cannot qualify for payment. If no children survive the employee, the unpaid annuity can be paid to:
3. the employee’s grandchildren. If no grandchildren survive the employee, the unpaid annuity can be paid to:
4. the employee’s parents. If no parents survive the employee, the unpaid annuity can be paid to:
5. the brothers and sisters of the employee.

If there is more than one person in the category of people to whom the unpaid survivor annuities is being paid, the unpaid survivor annuities will be split equally among all the qualified people in that category.