[Code of Federal Regulations]

[Title 20, Volume 1]

[Revised as of April 1, 2005]

From the U.S. Government Printing Office via GPO Access

[CITE: 20CFR226.32]



[Page 460-461]

 

                      TITLE 20--EMPLOYEES' BENEFITS

 

                  CHAPTER II--RAILROAD RETIREMENT BOARD

 

PART 226_COMPUTING EMPLOYEE, SPOUSE, AND DIVORCED SPOUSE ANNUITIES

--Table of Contents

 

         Subpart C_Computing a Spouse or Divorced Spouse Annuity

 

Sec.  226.32  Spouse tier II.



    The spouse tier II benefit is computed as follows:

    (a) The employee's tier II amount as computed under Sec.  226.11 of 

this part, after any reduction for entitlement to a vested dual benefit 

but before reduction for the railroad retirement family maximum, is 

multiplied by 45 percent. The spouse tier II is recomputed if the 

employee's tier II rate is reduced for entitlement to a vested dual 

benefit after the beginning date of the spouse annuity.



[[Page 461]]



    (b) If tier I of a spouse annuity is reduced for the spouse's 

employee annuity, as provided for in Sec.  226.30(g) of this part, the 

reduction is restored in tier II. The restored amount is payable on the 

effective date of the spouse or the employee tier I benefit, whichever 

is later. The previous tier II rate is increased by the restored amount, 

which is determined as follows:

    (1) Initial restored amount. The restored amount is the amount by 

which the spouse tier I was reduced by reason of receipt of an employee 

annuity on the date the restored amount is first payable. The restored 

amount is only payable if either the employee or spouse had railroad 

service prior to 1975.

    (2) Recomputation of restored amount. The restored amount is 

recomputed if the spouse becomes entitled to a government pension, a 

social security benefit, or a different type of social security benefit 

after the date the initial restored amount is effective. The recomputed 

amount is the amount by which the spouse tier I is reduced by reason of 

receipt of an employee annuity on the effective date of the entitlement 

to a government pension or social security benefit.

    (3) Cost-of-living increase in restored amount. If an initial or 

recomputed restored amount is effective before the effective date of the 

cost-of-living increase shown in paragraph (e) of this section, the 

restored amount is multiplied by the percentage increase that applies. 

The result is added to the restored amount on the effective date of the 

increase for each year that the increase is payable.

    (c) If the employee's tier II has been reduced pursuant to section 

3(g)(2) of the Railroad Retirement Act (takeback provision) the spouse 

tier II is reduced by one half of the ``takeback'' in the employee tier 

II.

    (d) If the railroad retirement family maximum applies, as shown in 

Sec. Sec.  226.50-226.52 of this part, the spouse tier II rate, as 

determined in paragraphs (a) through (c) of this section, is reduced by 

the smaller of--

    (1) The total railroad retirement maximum reduction amount; or

    (2) The previous spouse tier II rate.

    (e) The tier II rate, from paragraphs (a) through (d) of this 

section, is increased by the same percentage as the employee tier II 

increase described in Sec.  226.11(e) of this part.

    (f) If the spouse is entitled to a reduced age annuity (see Sec.  

216.51 of this chapter), the tier II rate, as determined in paragraphs 

(a) through (e) of this section is reduced in the same manner as the 

tier I as provided for in Sec.  226.30(e) of this part.



    Example: An employee's tier II rate is $329.63 effective October 17, 

1981. The spouse rate is $148.33 (45 percent x $329.63) effective 

October 17, 1981. This is increased to $151.89 effective June 1, 1982, 

by a cost-of-living increase of 2.4 percent. The spouse is 35 months 

under age 65, the present retirement age, when the annuity begins. The 

$151.89 rate is multiplied by 35/144 to produce an age reduction of 

$36.92. This is subtracted from $151.89 to produce a final rate of 

$114.97.