This chapter defines a “social security benefit” and explains how to handle taxation
of benefits inquiries.
Some beneficiaries have to pay federal income taxes on their Social Security benefits.
This usually happens if they have other substantial income (such as wages, self-employment,
interest, dividends and other taxable income that individuals report on their tax
returns) in addition to their benefits. No one pays federal income tax on more than
85 percent of his or her Social Security benefits based on the IRS rules.
Equivalent tier 1 railroad retirement benefits are the part of tier 1 benefits that
a railroad employee or beneficiary would have been entitled to receive under the social
security system. They are commonly called the Social Security Equivalent Benefit (SSEB)
portion of tier 1 benefits. Individuals, who receive these benefits, receive a Form
SSA-1099, Social Security Benefit Statement, or Form RRB-1099, Payments by the Railroad
Retirement Board, or Form SSA-1042S, Social Security Benefit Statement.