There's another not-so-little item that the RRB saves a ton of money with that probably 99% of rails aren't aware of until it is too late:



Work for Your Last Pre-Retirement Nonrailroad Employer

If you are a retired railroad employee or the spouse of a retired employee, part of your annuity is subject to earnings deductions if you work for your last pre-retirement nonrailroad employer. Your Tier II benefits and supplemental annuity, if any, are reduced $1 for every $2 in earnings from your last pre-retirement nonrailroad employer, subject to a maximum reduction of 50 percent. The reduction applies regardless of the amount of your earnings or your age.

A retired employee's work for a last pre-retirement nonrailroad employer can also cause a reduction in the spouse's Tier II benefits.



A lot of rails, myself included, have been caught in this largely unknown trap. A couple years before I retired from Amtrak the Oregon Zoo's Washington Park & Zoo Railway was looking for several part-time engineers (they call them a temporary engineer for contract purposes which limits work to <600 hours per year to prevent having to provide any benefits) and five Pacific Railroad Preservation Association (SP&S 700) volunteers attended an informational meeting with four of us deciding to accept the job. The work is generally Memorial Day - Labor Day and Thanksgiving - New Years. Other than crawling under the coaches in the pouring rain to change brake shoes the job is very pleasant and I was simply looking for something to do in retirement.

During my retirement interview with the RRB just a couple months before retirement I was made aware of this penalty and, hoping to avoid it, I asked if I could quit the WP&Z before retirement and then return to it later without the Tier II penalty. The answer was "no" because the same employer's IRS number would show up and trigger the penalty. In hindsight, I probably could have quit the zoo and gone to work part-time somewhere else for the last month before retirement (if I could find something that would fit my Amtrak work schedule) to make it the Last Pre-Retirement Nonrailroad Employer but there would have been no certainty of finding any opening at the zoo again in the foreseeable future. As it is I take a heavy hit on the zoo earnings that the RRB deducts from the Tier II benefit of both myself and my wife. And it is not like Tier I deductions which end when one attains Full Retirement Age (66 for me) but continues for as long as you continue to work for that Last Pre-Retirement Nonrailroad Employer.

At least I had the joy of being able to save a fellow Amtrak employee from making the same mistake. A few years ago I was returning home from a couple days of volunteering on the Mt. Rainier Scenic Railroad and decided to drive down Highway 603 through Winlock instead of using the parallel I-5. It Winlock I saw a southbound Talgo sitting on Main 1 so I stopped to chat with engineer Ron Lalime who was about a year away from retirement at that time IIRC. After the usual "how's retirement going?" question he mentioned that his sister was starting a new restaurant and had interested him in participating in its operation. With Amtrak retirement not that far in the future he was, as I had been, thinking of something to do after retirement. I shared my sad Tier II experience with him and he was very grateful for the information as he was another one of most RR employees who don't have a clue until it's too late.