Will I Lose My Current Connection With Self Employment Work Before Railroad Retirement?

Welcome to another edition of the Highball Advisors Railroad Retirement Whiteboard! I'm John McNamara from Highball Advisors. Today, we'll discuss how transitioning to self-employment after working for the railroad can affect your railroad retirement.

When you leave the railroad, the Railroad Retirement Board (RRB) will evaluate your new job's impact on your current connection status and, eventually, on your annuity. Understanding these impacts is crucial for your retirement planning.

Non-Railroad Work and Self-Employment Impact

1. Before Retirement: Any non-railroad work can affect your current connection status, which is important for eligibility and benefits. Always notify the RRB about your employment changes to determine how they impact your current connection.
2. After Retirement: Your work can lead to deductions from your annuity before you reach full retirement age. This applies to both self-employment and non-railroad positions. The RRB assesses if your post-retirement work involves "substantial services."

Key Considerations

• Current Connection: After leaving the railroad, your current connection might be severed if you work for another company. However, if you do consulting work, there may be some gray areas. Always check with the RRB to ensure your current connection is intact.
• Substantial Services: If you are self-employed, especially as a consultant for a railroad or any employer, the RRB will determine if you are performing substantial services. If deemed substantial, your annuity could be affected. This includes working for your former railroad employer or another railroad.
• Form AA-4: If you opt for self-employment, complete Form AA-4 to let the RRB assess whether your new role is considered substantial services related to the railroad.

Remember, both before and after starting your annuity, it's vital to understand how your new work status affects your railroad retirement benefits. Reach out to the RRB for guidance to avoid any potential issues with your annuity.

If you have further questions, feel free to contact me. Don't forget to click the notification bell and like the video if you found this information helpful. Stay safe, stay on track, and take care! So long, everybody

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Disclaimer: This article is provided for general information and illustration purposes only. Nothing contained in the material constitutes tax advice, a recommendation for purchase or sale of any security, or investment advisory services. Highball Advisors encourages you to consult a financial planner, accountant, and/or legal counsel for advice specific to your situation. Reproduction of this material is prohibited without written permission from Highball Advisors, and all rights are reserved from Highball Advisors, and all rights are reserved.