pleted at least 10 years of service, had a current connection with the railroad industry, and had at least 40 quarters of coverage; or had quarters of coverage at least equal to one-half the number of elapsed quarters after 1936 but not less than six; or had sufficient quarters of coverage to be fully insured under Title II of the Social Security Act if his service after 1936 were included in the term "employment" as defined in that act, provided that his death occurred on or after September 6, 1958 (or before that date if none of his survivors became entitled earlier to monthly benefits under Title II of the Social Security Act by reason of his death). In the case of an employee who, at the time of his death, had completed at least 10 years of service and had a current connection with the railroad industry, the determination of required quarters of coverage under provisions other than those of Title II of the Social Security Act is made as follows:

(1) Elapsed quarters. Take the number of calendar quarters which have elapsed after 1936, or after the quarter in which the employee attained the age of 21 if he attained such age after 1936, and up to but excluding the quarter in which the employee attained the age of 65 or died, whichever occurred first. Subtract from that number of elapsed quarters the number of such quarters which is not a wage quarter of coverage and during any part of which a retirement annuity was payable to the employee. If the resulting number of elapsed quarters is an odd number, subtract one. Take one-half of the number of elapsed quarters thus obtained, and the resulting number, if six or more, is the number of quarters of coverage required; if the resulting number is less than six, the number of quarters of coverage required is six,

(2) Quarters of coverage determined. (i) Determine the number of quarters of coverage the employee had acquired. If this number equals or exceeds the number required, the employee was completely insured.

(ii) A quarter of coverage may be acquired at any time subsequent to December 31, 1936, regardless of whether there are any elapsed quarters under subparagraph (1) of this paragraph and regardless of the age of the employee.

(iii) Quarters of coverage need not be consecutive and no particular order of their acquisition is required.

[12 F.R. 2018, Mar. 27, 1947, as amended by Board Order 59-232, 25 F.R. 479, Jan. 21, 1960; 25 F.R. 1073, Feb. 6, 1960; Board Order 60-99, 25 F.R. 5765, June 23, 1960]

§ 237.103 Partially insured status.

(a) Payments based upon partially insured status. An employee who was not completely insured at death may nevertheless have had a service, compensation, and wage history which, upon his death, will give him the status of a partially insured employee. Unless he was either completely insured or partially insured at death, his widow cannot become entitled to a widow's current insurance annuity, his surviving child cannot become entitled to a child's insurance annuity, and no person can become entitled to a lump-sum payment under section 5 (f) (1) of the act, on the basis of his earnings. For the purpose of determining whether an employee was a partially insured employee at death it is immaterial whether his death occurred before, on, or after the enactment date of section 5 of the act.

(b) Determination of partially insured status. (1) An employee was partially insured at death if he had completed at least 10 years of service, had a current connection with the railroad industry, and:

(i) Had at least six quarters of coverage in the period beginning with the third year before the year of retirement or death and ending with the quarter in which such event occurred; or

(ii) Had sufficient quarters of coverage to be currently insured under Title II of the Social Security Act if his service after 1936 were included in the term "employment" as defined in that act, provided that his death occurred on or after September 6, 1958 (or before that date if none of his survivors became entitled earlier to monthly benefits under Title II of the Social Security Act by reason of his death).

(2) Quarters of coverage need not be consecutive and no particular order of their acquisition is required.

| Board Order 55-89. 20 F.P. 3714. May 27, 1955, as amended by Board Order 59-232, 25 F.R. 480, Jan. 21, 1960]

§ 237.104 Alternative method of determining insured status.

Where application of the table in section 5(1) (4) of the act (see § 237.101) does not result in an employee's having a completely or partially insured status, it shall be presumed that the compensation paid him in a calendar year was paid in equal proportions with respect to all months in the year and the last line of the table applied to the result. This alternative method shall be applied to the most recent calendar year in which the employee received compensation and each preceding calendar year until an insured status is obtained, if at all, but not beyond 1937. This alternative method is to be applied only with respect to benefits accruing under the 1951 amendments, that is, in determining the insured status of a deceased employee and in determining whether a child would be otherwise entitled to a child's insurance annuity.

[Board Order 55-89, 20 F. R. 3714, May 27, 1955; 20 F. R. 6004, Aug. 18, 1955]

Subpart B-Basic Computation § 237.201 Statutory provisions.

The term "basic amount" shall mean(1) For an employee who will have been partially insured, or completely insured solely by virtue of paragraph (7)(i) or (7)(ii) or both: the sum of (A) 49 per centum of his average monthly remuneration, up to and including $75; plus (B) 12 per centum of such average monthly remuneration exceeding $75 and up to and including $450, plus (C) 1 per centum of the sum of (A) plus (B) multiplied by the number of years after 1936 in each of which the compensation, wages, or both, paid to him will have been equal to $200 or more; if the basic amount, thus computed, is less than $16.95 it shall be increased to $16.95;

(ii) For an employee who will have been completely insured solely by virtue of paragraph (7) (iii): the sum of 49 per centum of his monthly compensation if an annuity will have been payable to him, or, if a pension will have been payable to him, 49 per centum of the average monthly earnings on which such pension was computed, up to and including $75, plus 12 per centum of such compensation or earnings exceeding $75 and up

to

and including $300. If the average monthly earnings on which a pension payable to him was computed are not ascertainable from the records in the possession of the Board, the amount computed under this subdivision shall be $40.33, except that if the pension payable to him was less than $30.25, such amount shall be four-thirds of the

amount of the pension or $16.13, whichever is greater. The term "monthly compensation" shall, for the purposes of this subdivision, mean the monthly compensation used in computing the annuity;

(iii) For an employee who will have been completely insured under paragraph (7) (iii) and either (7)(i) or (7) (ii): The higher of the two amounts computed in accordance with subdivisions (i) or (ii). (Section 5(1)(10) of the act)

An employee's "average monthly renumeration" shall mean the quotient obtained by dividing (A) the sum of (i) the compensation paid to him after 1936 and before the employee's closing date, eliminating any excess over $300 for any calendar month before July 1. 1954, any excess over $350 for any calendar month after June 30, 1954, and before the calendar month [June 1959] next following the month in which this Act was amended in 1959 [May 1959], any excess over $400 for any calendar month after the month in which this Act was so amended and before the calendar month [November 1963] next following the month in which this Act was amended in 1963 [October 1963] and any excess over $450 for any calendar month after the month in which this Act was so amended, and (ii) if such compensation for any calendar year before 1955 is less than $3,600 or for any calendar year after 1954 and before 1959 is less than $4.200, or for any calendar year after 1958 is less than $4,800, and the average monthly renumeration computed on compensation alone is less than $450 and the employee has earned in such calendar year "wages" as defined in paragraph (6) hereof, such wages, in an amount not to exceed the difference between the compensation for such year and $3,600 for years before 1955, $4,200 for years after 1954 and before 1959, and $4,800 for years after 1958, by (B) three times the number of quarters elapsing after 1936 and before the employee's closing date:

Provided, That for the period prior to and including the calendar year in which he will have attained the age of twenty-two there shall be included in the divisor not more than three times the number of quarters of coverage in such period: Provided, further, That there shall be excluded from the divisor any calendar quarter which is not a quarter of coverage and during any part of which a retirement annuity will have been payable to him. An employee's "closing date" shall mean (A) the first day of the first calendar year in which such employee both had attained age 65 and was completely insured; or (B) the first day of the calendar year in which such employee died; or (C) the first day of the calendar year following the year in which such employee died, whichever would produce the highest "average monthly remuneration" as defined in the preceding sentence. If the amount of the "average

monthly remuneration" as computed under this paragraph is not a multiple of $1, it shall be rounded to the next lower multiple of $1.

With respect to an employee who will have been awarded a retirement annuity, the term "compensation" shall, for the purposes of this paragraph, mean the compensation on which such annuity will have been based. (Section 5(1) (9) of the act)

The term "wages" shall mean wages as defined in section 209 of the Social Security Act. In addition, the term shall include (1) "self-employment income" as defined in section 211(b) of the Social Security Act, and (11) wages deemed to have been paid under section 217 (a) or (e) of the Social Security Act on account of military service which is not creditable under section 4 of this act. Wages, as defined in this paragraph, shall be credited for the purposes of this section in the manner and to the extent credited for corresponding purposes of Title II of the Social Security Act. (Section 5(1)(6) of the act)

Board Order 64-105, 29 F.R. 11916, Aug. 20, 1964]

(ii) Determine the number of calendar years after 1936 in which $200 or more of compensation, wages, or both, were paid to the employee. Multiply the number of such years by 1 percent of the amount computed under subdivision (i) of this subparagraph.

(iii) Add the figure computed under subdivision (i) of this subparagraph and the figure computed under subdivision (ii) of this subparagraph. The sum so obtained is the basic amount. If such sum is less than $16.95, it is increased to $16.95.

(2) Employee completely insured solely because of being a pensioner. (i) If the average monthly earnings on which the pension was computed are ascertainable from the records in the possession of the Board, and if such average monthly earnings do not exceed $75, take 49 percent of such average monthly earnings. If such average monthly earnings exceed $75, take 49 percent of $75 and add thereto 12 percent of the amount by which the average monthly earnings exceed $75 and do not exceed $300. This sum is the basic amount.

(ii) If the average monthly earnings on which the pension was computed are not ascertainable from the records in the possession of the Board, and if the pension was $30.25 or more, the basic amount is $40.33; but if the pension was less than $30.25, the basic amount is four-thirds of the amount of the pension which was payable at death, or $16.13, whichever is greater.

(3) Employee completely insured solely because of being an annuitant. If the employee's monthly compensation does not exceed $75, take 49 percent of such monthly compensation. If the monthly compensation exceeds $75, take 49 percent of $75 and add thereto 12 percent of the amount by which the monthly compensation exceeds $75 and does not exceed $300. This sum is the basic amount. For the purposes of this subparagraph, "monthly compensation" means the monthly compensation which was used in computing the employee's annuity.

an

(4) Employees completely insured both because of being pensioners or nuitants and also because of current connection and quarters of coverage. If the employee was a pensioner, compare the amount computed under subparagraph (1) of this paragraph with the amount computed under subparagraph (2) of this paragraph; whichever is

greater is the basic amount. If the employee was an annuitant, compare the amount computed under subparagraph (1) of this paragraph with the amount computed under subparagraph (3) of this paragraph; whichever is greater is the basic amount.

[Board Order 59-232, 25 F.R. 480, Jan. 21, 1960; 25 FR. 1074, Feb. 6, 1960, as amended by Board Order 62-46, 27 F.R. 4878, Apr. 25, 1962; Board Order 64-105, 29 F.R. 11917, Aug. 20, 1964]

§ 237.203 Average monthly remuneration.

A decreased employee's average monthly remuneration is computed by dividing his creditable compensation and wages by three times the number of his divisor quarters.

(a) Compensation and wages. (1) Take all compensation paid to the employee, including compensation attributable to military service, after 1936 and before the employee's closing date, excluding any amount in excess of that creditable for a month (see § 222.3 of this chapter).

(2) Where the compensation, including compensation attributable to military service, for any calendar year after 1936 and through 1954 and before the employee's closing date is less than $3,600, wages as defined in section 5(1)(6) of the act in an amount not to exceed the difference between such compensation for the year and $3,600 shall be included. Where such compensation for any calendar year after 1954 and through 1958 and before the employee's closing date is less than $4,200, such wages in an amount not to exceed the difference between such compensation for the year Where and $4,200 shall be included.

such compensation for any calendar year after 1958 and before the employee's closing date is less than $4,800, such wages in an amount not to exceed the difference between such compensation for the year and $4,800 shall be included.

(b) Divisor quarters. Take the number of calendar quarters which have elapsed after 1936 or after the year in which the employee attained age 22, whichever is later, and before the employee's closing date. Add to such elapsed quarters the number of quarters of coverage credited the employee before the year in which he attained age 23. Subtract from the number of quarters thus arrived at the number of such quarters which are not wage quarters of coverage and during any part of which a

retirement annuity was payable to the employee. The result is the divisor quarters.

(c) Rounding. An average monthly remuneration that is computed under this section and that is not a multiple of $1, shall be rounded to the next lower multiple of $1.

[Board Order 59-232, 25 F.R. 481, Jan. 21, 1960, as amended by Board Order 62-46, 27 F.R. 4878, Apr. 25, 1962]

§ 237.204 Closing date.

An employee's closing date shall be whichever of the following produces the highest average monthly remuneration as defined in § 237.203:

(a) The first day of the first calendar year in which the employee both had attained age 65 and was completely insured; or

(b) The first day of the calendar year in which the employee died; or

(c) The first day of the calendar year following the year in which the employee died.

[Board Order 59-232, 25 F.R. 482, Jan. 21, 1960 as amended by Board Order 62-46, 27 F.R. 4878, Apr. 25, 1962]

§ 237.205 Reduction because of military service used for other benefits.

When any other gratuitous benefit is payable on a periodic basis under another act of Congress on the basis of military service which has been used in establishing an insured status or in calculating the basic amount of a deceased employee, a survivor insurance annuity, based on the employee's insured status, which is payable for all or part of a month for which such other benefit is payable, shall be reduced by

(a) The proportion that the number of years of service by which such military service increases the total years of service bears to the total years of service (including service before 1937), or

(b) The aggregate amount of such other benefit for that month,

whichever results in the smaller reduction; however, where eligibility for the insurance annuity exists without the crediting of the military service on the basis of which such other benefit is payable, the insurance annuity shall not be reduced below the amount which would be payable without the crediting of the military service.

[Board Order 62-46, 27 F.R. 4878, Apr. 25, 1962]

Subpart C-Family Relationships

§ 237.301 Statutory provisions.

For the purposes of this section (1) The qualifications for "widow," "widower," "child," and "parent" shall be except for the purposes of subsection (f), those set forth in section 216 (c), (e), and (g), and section 202 (h) (3) of the Social Security Act, respectively; and in addition

(1) A "widow" or "widower" shall have been living with the employee at the time of the employee's death; a widower shall have received at least one-half of his support from his wife employee at the time of her death or he shall have received at least onehalf of his support from his wife employee at the time her retirement annuity or pension began.

(ii) A "child" shall have been dependent upon its parent employee at the time of his death; shall not be adopted after such death by other than a stepparent, grandparent, aunt, or uncle; shall be unmarried; and shall be less than eighteen years of age, or shall have a permanent physical or mental condition which is such that he is unable to engage in any regular employment: Provided, That such disability began before the child attains age eighteen; and

(111) A "parent" shall have received, at the time of the death of the employee to whom the relationship of parent is claimed, at least one-half of his support from such employee.

A "widow" or "widower" shall be deemed to have been living with the employee if the conditions set forth in section 216 (h) (2) or (3), whichever is applicable, of the Social Security Act, as in effect prior to 1957, are fulfilled. A "child" shall be deemed to have been dependent upon a parent if the conditions set forth in section 202(d) (3), (4), or (5) of the Social Security Act are fulfilled (a partially insured mother being deemed currently insured). In determining for purposes of this section and subsection (f) of section 2 whether an applicant is the wife, husband, widow, widower, child, or parent of an employee as claimed, the rules set forth in section 216(h)(1) of the Social Security Act, as in effect prior to 1957, shall be applied. Such satisfactory proof shall be made from time to time, as prescribed by the Board, of the disability provided in clause (11) of this paragraph and of the continuance, in accordance with regulations prescribed by the Board, of such disability. If the individual fails to comply with the requirements prescribed by the Board as to the proof of the continuance of the disability his right to an annuity shall, except for good cause shown to the Board, cease. Where a woman has qualified for an annuity under this section as a widow. and marries another employee who dies within one year after the marriage, she shall not be disqualified for an annuity under this section as the widow of the second employee by reason of not having been married to the employee for one year; Section 5(1)(1) of the act).

The term "widow" * means the surviving wife of an individual, but only if (1) she is the mother of his son or daughter, (2) she legally adopted his son or daughter while she was married to him and while such son or daughter was under the age of eighteen, (3) he legally adopted her son or daughter while she was married to him and while such son or daughter was under the age of eighteen, (4) she was married to him at the time both of them legally adopted a child under the age of eighteen, (5) she was married to him for a period of not less than one year immediately prior to the day on which he died, or (6) in the month prior to the month of her marriage to him (A) she was entitled to, or on application therefor and attainment of age 62 in such prior month would have been entitled to, benefits under subsection (e) or (h) of section 202, or (B) she had attained age eighteen and was entitled to, or on application therefor would have been entitled to, benefits under subsection (d) of such section. (Section 216(c) of the Social Security Act.)

The term "child" means (1) the child or legally adopted child of an individual, and (2) a stepchild who has been such stepchild for not less than one year immediately preceding the day on which application for child's insurance benefits is filed or (if the insured individual is deceased) the day on which such individual died. For purposes of clause (1), a person shall be deemed, as of the date of death of an individual, to be the legally adopted child of such individual if such person was at the time of such individual's death living in such individual's household and was legally

adopted by such individual's surviving

spouse after such individual's death but before the end of two years after the day on which such individual died or the date of enactment of this Act; except that this sentence shall not apply if at the time of such individual's death such person was receiving regular contributions toward his support from someone other than such individual or his spouse, or from any public or private welfare organization which furnishes services or assistance for children. For purposes of clause (2), a person who is not the stepchild of an individual shall be deemed the stepchild of such individual if such individual was not the mother or adopting mother or the father or adopting father of such person and such individual and the mother or adopting mother, or the father or adopting father, as the case may be, of such person went through a marriage ceremony resulting in a purported marriage between them which, but for a legal impediment described in the last sentence of subsection (h) (1) (B), would have been a valid marriage. (Section 216(e) of the Social Security Act)

The term "widower" means the surviving husband of an individual, but only if (1) he is the father of her son or daughter, (2) he legally adopted her son or daughter