How are railroad retirement widow(er)s benefits affected by the new law?
Under prior law, the widow(er)’s tier I benefit, before any reductions for other benefits, was generally equal to the amount of the tier I benefit that the employee received at the time of his or her death; and a widow(er)’s tier II benefit was generally equal to 50 percent of the tier II benefit that was payable to the employee at the time of his or her death. The new law establishes an “initial minimum amount” which yields, in effect, a widow(er)’s tier II benefit equal to the tier II benefit the employee would have received at the time of the award of the widow(er)’s annuity. It does this by adding a “guaranty amount,” initially set at 50 percent of the employee’s tier II, to the 100 percent tier I and 50 percent tier II benefits provided under prior law. This “guaranty amount” will be offset each year by the dollar amount of the cost-of-living increases payable in both the tier I and tier II benefits provided under prior law. Consequently, such a widow(er)’s net benefit payment wil
