TN 25 (09-11)
RS 02501.150 Beneficiary Entitled on Two Earnings Records (E/Rs) Both Beneficiaries with Simultaneous Entitlement and Other Number Holder (NH) Have Excess Earnings
A. Policy for charging excess earnings
1. Full month withholding
When a beneficiary has entitlement to both auxiliary benefits and retirement insurance benefits (RIB), charge the excess earnings against his or her auxiliary benefit to the extent that the auxiliary benefit is not subject to deductions because of the other NH's work. Charge the excess earnings to the RIB without regard to the other NH's excess earnings.
2. Partial month withholding
If a beneficiary has entitlement on her own and her husband's ER and has excess earnings chargeable to a month in which she shares a partial benefit on the husband's ER, charge her excess for the month to the combined amount of her RIB and her share of the partial benefit.
If her excess earnings for the month in question are less than the combined amount, we must apportion the earnings. If two trust funds are involved or there is entitlement with an additional beneficiary (other than the two spouses) on either ER, make the required apportionment under the rules in RS 02501.145.
For purposes of the initial apportionment of the wife's excess to her wife's benefit, consider the amount due to her without any deduction because of her own or her husband's work. Regardless of this apportionment, only charge her excess earnings to the husband's ER up to the amount paid to her after charging his excess earnings. The amount charged to her own ER will be the difference between the total of her excess chargeable to the month and the lesser of:
B. Example when husband and wife have excess earnings
John had excess earnings of $720 and his wife, Ada, had excess earnings of $150. Ada was also entitled on her own ER.
Original rates on John's ER
Benefits on Ada's ER
Benefits payable on John's ER
Amount of John's excess charged to January benefits
Partial benefits for February after charging John's remaining excess of $350
($370 minus 350 = $20 prorated on the basis of 4 shares)
How to charge Ada's excess earnings from January-February
Charge Ada's total excess of $150 against her own monthly rate of $110 for January because John and the family are subject to a deduction because of John's work. In February, because of John's fully charged excess and there is money left to pay, charge Ada's excess against the total of her A and B benefit of $115 (her benefit of $110 plus the $5 payable to her on John's account). Her remaining excess is $35. Since there is another beneficiary besides the two workers, apportion the amount for February. For information on a beneficiary entitled on two earnings records and only the beneficiary with simultaneous entitlement has excess earnings, see RS 02501.145.
January 0 plus February $3.30 payable
5/115 x $40 = $1.70
$5.00-$1.70 = $3.30
(ADA) February $110 plus $36.70 = $150
Partial benefit payable for February
A (John) $10
B (Ada) $1 ($1.70 rounded down to the nearest dollar)
A (Ada) $73 rounded ($73.30 rounded)