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Where Does The Social Security I Paid Into Go?

Currently on occupational disability from railroad. Also receiving Ohio police and fire pension. Where does the social security paid into from previous jobs go? Railroad states that social security is figured into my disability payments however, I have never been provided with proof. I still receive statements from social security indicating amount earned.
Thank you


If you either don't have sufficient Social Security work credits to qualify for a Social Security (SS) benefit, or even if you do have enough credits to draw SS benefits but you elect not to claim them, the Railroad Retirement Board (RRB) can use your Social Security covered earnings to compute your Railroad Retirement (RR) or disability benefits. The SS covered earnings wouldn't necessarily actually be used, though. They'd only be used if they were among your highest earnings years used to calculate your RR benefit rate.

It works the same way in reverse by the way. If a person had RR earnings but not enough credits to qualify for a RR pension, then SS can potentially use the RR covered earnings to calculate the person's SS benefit rate. Social Security and Railroad Retirement maintain separate trust funds into which the payroll taxes collected are placed. How and if funds are actually transferred between the RR and SS trust funds is above my pay grade, however. My area of expertise is limited to Social Security benefits.

The extent of my knowledge regarding RR benefits is limited to how RR benefits coordinate with SS benefits. What I can tell you is that if you qualify for SS benefits and choose to start drawing SS benefits, the RRB would offset your Tier 1 RR benefits dollar for dollar by the amount of your SS benefits. Therefore, it's generally only advantageous for someone collecting RR benefits to file for SS benefits if their SS benefit rate would be higher than their Tier 1 RR rate. In spite of that, though, people receiving RR benefits have the option to claim any SS benefits for which they qualify. Therefore, Social Security needs to maintain a record of everyone's SS earnings history even if they're receiving RR benefits, and that's why you're continuing to receive SS statements.

Best, Jerry

Aug 18 2020 - 3:18pm
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