If, in any year before you retired, you worked for more than one railroad employer or worked in both railroad employment and social security-covered employment, your combined gross earnings from employment or net earnings from self-employment may have exceeded the tier I yearly earnings maximum for that year. You may qualify for a refund of any excess taxes that were withheld from your earnings under the Federal Insurance Contributions Act (FICA) or the Railroad Retirement Tax Act (RRTA) or that you paid under the Self-Employment Contributions Act (SECA).
Earnings After Year 1974
Your combined railroad and social security covered earnings may exceed the tier I yearly earnings maximum in any year after 1974, if you either:
- work in both railroad employment (RRTA) and social security-covered employment (FICA); or,
- work for two railroad employers (RRTA).
You can obtain a refund of the FICA or RRTA tax for the earnings in excess of the tier I yearly earnings maximum. Claim the amount of the excess FICA or RRTA tax on your income tax return (U.S. Individual Income Tax Form 1040 or Form 1040A, under Excess FICA or RRTA Tax Withheld). This is how people who have never worked in the railroad industry get refunds for their excess social security taxes. There is a three-year statute of limitations on such claims.
Earnings 1951 through 1974
If your combined railroad and social security- covered earnings exceeded the yearly earnings maximum in any year from 1951 through 1974, you qualify for the refund of excess tax if you have at least 120 months (10 years) of railroad service and are not entitled to a Vested Dual Benefit. The refund is the amount of the RRTA, FICA or SECA tax based on the amount of your yearly earnings that exceeded the yearly earnings maximum for that year. If you qualify for this refund, you do not have to apply for it. The RRB will automatically pay it to you when you retire. If you die before receiving this refund, it will be paid to your survivors.