Casey, a career railroad worker, had NESE of $110,000, wages of $2,000, and railroad
compensation of $3,000 in 2007. His earnings record shows wages of $2,000 and SEI
of $95,500, for the maximum creditable amount of $97,500. However, only $92,500 of
the SEI is subject to self-employment tax because the $3,000 in RR compensation can
be deducted as well as the $2,000 in wages ($2,000 and $3,000 from $97,500 equals
$92,500). Casey’s earnings record should be corrected to show only $92,500 SEI plus
$2,000 wages.