Flat Tax?
Steve Bruns
sbruns at kuntrynet.com
Fri Jan 22 17:04:43 PST 1999
Railroad Retirement a mandatory program that takes the place of Social Security for railroad
employees. It is divided into 2 "tiers", the first (Tier 1) of which is exactly the same as
Social Security. Same employer/employee contributions same (1998) cap of $68,400. Tier 2 is
over and above Tier 1 and also mandatory. (These numbers are from memory but close) It has a
lower income cap of $50,200. It has an employee contribution of 5.6% and an employer
contribution of 16.4% of income. It includes an occupational disability feature after 10 years
as opposed to SS total disability. This has recently come under attack by Reaganoid RR Board
members. Participants with 360 credited months of service can retire at age 62 with a full
annuity. Retirement at age 60 is available at an approximate 30% reduction in Tier 1 benefits.
Those with less than 360 months are on, as I recall, the same sliding scale of retirement as SS
depending on birth year of retiring somewhere between 65-67. RR annuities are somewhat higher
than SS and it includes an unemployment provision and a sickness benefit both valued at about
$45/day. The demise of RR is rumored quite often but talk seems to have quieted lately.
Steve Bruns
Tom Lehman wrote:
> Dear Steve,
>
> Can you fill us in on the details of the payroll taxes associated with RR retirement?
>
>
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