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shall be charged to each succeeding month in such year to the extent of the annuity payable for such month until the total of such excess earnings has been so charged or until every month to which the excess earnings are chargeable has been charged with such excess earnings. The phrase “first month of the taxable year" means the earliest month in such year to which the charging of excess earnings is not prohibited by the provisions of subparagraph (4) of this paragraph.
(4) Months to which excess earnings cannot be charged. Notwithstanding the provisions of subparagraph (3) of this paragraph, excess earnings determined in accordance with subparagraph (1) of this paragraph shall not be charged to any month:
(i) In which the individual was not entitled to an annuity;
(ii) In which the individual was 72 years of age or over;
(iii) In which the individual was entitled to a child's insurance annuity under § 237.409 based on a disability; or
(iv) In which the individual did not engage in self-employment and did not render services for wages, as defined in subparagraph (6) (ii) of this paragraph, of more than $100. (An individual shall be deemed to have engaged in self-employment in any month if in such month he renders substantial services, as defined in subparagraph (5) of this paragraph, in operating a trade or business as owner or partner, even though there may be no earnings or net earnings from self-employment attributable to his services for such month; and he will be presumed with respect to any month to have rendered services for wages, as defined in subparagraph (6) (ii) of this paragraph, of more than $100 until it is shown to the satisfaction of the Board that he did not render services in such month for more than such amount.)
(5) Definition of “substantial services.” For the purposes of subparagraph (4) of this paragraph, an individual engaged in self-employment is presumed to have rendered substantial services in each month in his taxable year. However, he may submit evidence to establish that in any month in such taxable year he did not render substantial services with respect to any trade or business the net income or loss of which is includible in computing his earnings (but without regard to subparagraph (6) (ii) of
this paragraph) for any taxable year if such taxable year begins after 1956. In determining whether an individual has rendered such substantial services in & month, the particular facts in his case will be examined. The following factors, among others, will be considered in making the determination:
(i) The amount of time devoted to the trade or business;
(ii) The nature of the services rendered by the individual;
(iii) The relationship of the activity performed prior to the period of retirement with that performed subsequent to retirement;
(iv) The setting in which the sery. ices were performed, including:
(a) The presence or absence of a paid manager, a partner, or a family member who manages the business;
(6) The type of business establishment that is involved;
(c) The amount of capital invested in the trade or business; and
(d) The seasonal nature of the trade or business.
(6) Definition of earnings. When the term "earnings" is used in this paragraph and not as a part of the phrase "net earnings from self-employment" and not as a part of the term "excess earnings,” it shall mean an individual's earnings with respect to a taxable year beginning after 1956 and includes the sum of his wages, as defined in subdivision (ii) of this subparagraph, for services rendered in such year and his net earnings from self-employment, as defined in subdivision (i) of this subparagraph, for such year minus any net loss from self-employment as defined in subdivision (1) of this subparagraph, for such year. With respect to a taxable year beginning after 1958 an individual's earnings from an activity performed outside the United States shall be determined in the same manner as if such activity were performed within the United States.
(i) Net earnings from self-employment and net loss from self-employment. An individual's net earnings from selfemployment and his net loss from selfemployment for the purposes of this subparagraph and subparagraph (5), shall be determined under the provisions of section 211 of the Social Security Act (but without regard to the provisions in paragraphs (1), (4), and (5) of subsections (c) of such section); any excess
of income over deductions so resulting held to effect a deduction under any of from such computation shall be his net the other paragraphs of this section, or earnings from self-employment and any under $ 237.703, or an adjustment under excess of deductions over income so re Part 255 of this chapter, does not affect sulting shall be his net loss from self the right of a widow, who has the child employment.
in her care, to a widow's current insur(ii) Wages. For purposes of this sub ance annuity, since the child is nevertheparagraph and subparagraph (4) of this less “entitled” to a child's insurance anparagraph, an individual's wages shall nuity. be determined under section 209 of the (d) Manner of making deductions. Social Security Act (but without regard (1) Deductions as provided for in this to the limitations as to amounts of re section are made by withholding insurmuneration specified in subsections (a), ance annuities in whole or in part, de. (g) (2), (g) (3), (h) (2), and (j) of such pending upon the amount to be deducted. section); and in making such computa If the amount to be deducted is not withtion, services which do not constitute beld from the insurance annuity or an"employment” as that term is defined nuities for the month in which the event in section 210 of the Social Security Act occurred which occasioned the deduction performed within the United States by (if, for example, the occurrence has not an individual as an employee or per been brought to the attention of the formed outside the United States in the Board), such amount will be with held active military or naval service of the from the insurance annuity or annuUnited States, shall be deemed to be ties for one or more subsequent months. employment as so defined if the remu The total amount to be deducted may, neration for such services is not includ therefore, at the time of withholding, be ible in computing his net earnings from greater or less than any insurance annuself-employment or net loss from self ity or annuities for a month from which employment, as defined in subdivision such amount is to be withheld. (1) of this subparagraph.
(2) When it is determined that a de(111) Presumptions concerning wages. duction is required under paragraph (a), For purposes of this subparagraph, (b), or (c) of this section, no insurance wages, as determined under subdivision annuity to which the individual in ques(11) of this subparagraph, which accord tion is entitled for any month will be paid ing to reports received by the Board are until a total amount equal to the amount paid to an individual during a taxable to be deducted has been withbeld. I year shall be presumed to have been paid the amount of the required deduction is to him for services rendered in such year less than any such insurance annuity, or until it is shown to the satisfaction of the total of such insurance annuities, the Board that they were paid for serv for a month, the amount to be deducted ices rendered in another taxable year.
will be withheld from such insurance anIf such reports with respect to an indi nuity or annuities. vidual show his wages for a calendar (e) Deductions where more than one year, such individual's taxable year shall deduction event in a month occurs. Secbe presumed to be a calendar year for tion 5 (1) (2) of the act prevents duplipurposes of this section until it is shown cation of deductions described in parato the satisfaction of the Board that his graphs (a), (b) and (c) of this section, taxable year is not a calendar year. by reason of the occurrence of more
(c) Failure of a widow to have a child than one of the events enumerated in in her care. (1) Deductions are to be such paragraphs in a particular month. made from any annuity or annuities pay If more than one such event occurs in able to a widow under section 237.408 for a month, the total amount of the deducany month in which such widow does not tion is the same as if only one such event have in her care a child of her deceased had occurred. Section 5 (1) (2) of the husband entitled to a child's insurance act has no application to any other deannuity for such month. The amount ductions or adjustments under the act to be deducted is equal to the amount (see paragraph (h) of this section). of the widow's current insurance annuity (f) Total amount to be deducted. L. to which she was entitled for the month however, any of the events occasioning in which she did not have such a child the deduction under paragraph (a), (b), in her care.
or (c) of this section occurs in more (2) The fact that a child's insurance than one month, the total amount to be annuity for a particular month is with deducted is equal to the sum of the
deductions for all months in which any of 1935, and section 5 of the Railroad Resuch event occurred. With respect to tirement Act of 1937, provided for cerearnings under paragraph (b) (1) of this tain payments upon the death of an emsection, a deduction event is deemed to ployee. Those provisions are superseded, have occurred in any month to which effective January 1, 1947, by the proviexcess earnings are charged (see para sions of section 5 of the Railroad Retiregraph (b)(3) of this section).
ment Act as amended. The amendatory (g) Relation to maximum and mini act provides that payments upon death mum insurance annuity totals. In ef as provided in section 5 of the 1935 and fecting a deduction, no amount can be 1937 acts, other than survivor annuities considered as having been withheld from pursuant to an election, shall be made an insurance annuity for a particular only with respect to deaths occurring bemonth which is in excess of the amount fore January 1, 1947. The total amount of such insurance annuity as reduced paid under the unamended sections 3 or increased (if required) under section with respect to the death of an employee, 5 (h) of the act (see Subpart F of this except survivor annuity payments made part). Likewise, the amount of an in pursuant to an election, must be deducted surance annuity by which a deduction is from any insurance annuities under this measured (i. e., an insurance annuity part based on the insured status of that for the month in which the event oc deceased employee. casioning the deduction occurred) is the (b) Lump-sum death payments under amount of such insurance annuity as so Social Security Act. The total amount reduced or increased.
of any lump sum paid under title I of (h) Relation to other provisions for the Social Security Act with respect to deductions and adjustments. A deduc the death of an employee must be detion required under section 5 (i) (1) of ducted from any insurance annuities the act is made prior to and in addition under this part based on the insured to any deductions under section 5 (1) (3)
status of that deceased employee. of the act (see $ 237.703), and prior to (c) Manner of making deductions. and in addition to any adjustments un (1) If more than one person is entitled der Part 255 of this chapter.
to any insurance annuity or annuities (1) Reports to the Board of certain under this part on the basis of the inevents occasioning deductions. Section sured status of the same deceased em5 (1) (2) of the act imposes upon an in ployee, the deduction required under dividual the obligation to report to the paragraph (a) or (b) of this section is Board the occurrence of any of the events made from the insurance annuity or anenumerated in paragraph (a), (b), or nuities to which each such person is en(c) of this section if such individual is in titled in the proportion that his insurreceipt of an insurance annuity or annu. ance annuity or annuities for a month ties (on his own behalf or on behalf of bears to the total of such insurance ananother) from which a deduction is to be nuities for a month. made under such paragraphs.
(2) In any case in which a deduction (Board Order 55-89, 20 F. R. 3720, May 27, under paragraph (a) or (b) of this sec1955, as amended by Board Order 60-12, 25 tion is to be made, the deduction of the F.R. 1675, Apr. 6, 1960; Board Order 63–149, amount designated in paragraph (a) or 28 FR. 9525, Aug. 30, 1963)
(b) of this section is made by actuarial § 237.703 Deductions because of death
recovery from any insurance annuity un. benefit payments.
der this part to which such individual
is or becomes entitled on the basis of Section 5(1) (3) of the act provides for
the insured status of the employee recertain deductions from any insurance ferred to in such paragraph: Provided, annuities or lump-sum death payments
however, That the deduction is not less under section 5 on the basis of the in
than the amount of the insurance ansured status of a deceased employee. The basis for and the amount of each of
nuity for a month: Provided further, these deductions are set out in para
That the actuarial reduction does not graphs (a) and (b) of this section.
exceed the amount of the insurance an(a) Death benefits under Retirement
nuity for a month: And provided further, Acts. Prior to the amendments approved
That such individual does not request July 31, 1946, effective January 1, 1947,
the withholding of the entire monthly with regard to the matters here involved, insurance annuity until the total amount section 5 of the Railroad Retirement Act withheld equals the total amount to be
recovered. If the deduction is less than deduction is required, there will be withthe amount of the insurance annuity, or held from the insurance annuity the if the actuarial reduction exceeds the amount by which such insurance annuity amount of the insurance annuity for a exceeds the amount of the insurance month, or if the individual specifically benefit to which the individual had been so requests, the deduction is made by so entitled under the Social Security withholding until
accumulated Act; this withholding will be continued withholdings equal the total amount to until such time as the total of the be recovered.
amounts thus withheld from the insur(d) Relation to other provisions. (1) ance annuity equals the amount to be When deductions are to be made under deducted from such Insurance annuity. this section from an inurance annuity (2) If the case is not within the puror insurance annuities, the amounts to view of subparagraph (1) of this parabe deducted are meas:ired by and are graph, the deduction is made by withwithheld from the amount of the insur holding, to the extent hereinafter indiance annuity, or the amounts of the in cated, the amount designated in such surance annuities, as reduced or in paragraph (a), (b), (c), or (d) of this creased under section 5(h) of the act section, from any such insurance annuity (see Subpart F of this part).
under this part to which such individual (2) A deduction required under this is or becomes entitled on the basis of the section is made in addition to any de
insured status of the employee referred ductions required under section 5(1) (1) to in such paragraph. Upon determinaof the act (see $ 237.702), and in addition
tion that such a deduction is required, to any adjustment under Part 255 of
no such insurance annuity for any month this chapter.
will be paid until a total amount equal (e) Manner of making deductions. If
to the amount to be deducted has been more than one person is entitled to any
withheld. If the amount to be deducted insurance annuity or annuities, or to
is less than the amount of any such inany lump-sum death payment, under
surance annuity for a month, the amount this part, on the basis of the insured
to be deducted will be withheld from the status of the same deceased employee,
amount of such insurance annuity. the deduction required under paragraph In any case in which a deduction un(a), (b), (c), or (d) of this section is der paragraph (c) or (d) of this section made from the insurance annuity or
is to be made from lump-sum death annuities, or from the share of the lump payments under this part, such deducsum, to which each such person is en
tion is made by withholding the amount titled, in the proportion that his insur designated in such paragraph from any ance annuity or annuities for a month, such lump-sum death payments to which or his share of the lump sum, bears to any individual is or becomes entitled on the total of such insurance annuities the basis of the insured status of the for a month, or the total of such lump employee referred to in such paragraph. sum.
Upon determination that such a deducIn any case in which a deduction under tion is required, no such lump-sum death paragraph (a), (b), (c), or (d) of this payment will be paid until a total amount section is to be made from an insurance equal to the amount to be deducted has annuity under this part, such deduction
been withheld. If the amount to be deis made in the following manner:
ducted is less than the lump sum then (1) If the individual had been re
payable, the amount to be deducted will ceiving an insurance benefit under the
be withheld from such lump sum. Social Security Act, and ceased to be (f) Relation to other provisions. entitled thereto because of the provi When deductions are to be made under sions of section 5 (g) (1) of the Railroad
this section from an insurance annuity Retirement Act, as amended, the deduc or insurance annuities, the amounts to tion is made by withholding, to the ex be deducted are measured by and are tent hereinafter indicated, the amount
withheld from the amount of the insurdesignated in such paragraph (a), (b), ance annuity, or the amounts of the in. (c), or (d) of this section, from any such surance annuities, as reduced or ininsurance annuity under this part to creased under section 5(h) of the act which such individual is or becomes en (see Subpart F of this part), titled on the basis of the insured status A deduction required under this secof the employee referred to in such para tion is made in addition to any deducgraph. Upon determination that such a tions required under section 5(1) (1) of
the act (see § 237.702), and in addition to any adjustment under Part 255 of this chapter. (12 F.R. 2025, Mar. 27, 1947, as amended by Board Order 60-12, 25 F.R. 1676, Feb. 26, 1960; Board Order 63–149, 28 F.R. 9526, Aug. 30, 1963) Subpart H-Application for Insurance
Annuities and lump Sums for Sur
vivors § 237.801 Statutory provisions.
(See section 5(j) of the act, quoted in § 237.401, and the last sentence of section 5(f) (1) of the act, quoted in § 237.501.) (Board Order 55-89, 20 F.R. 3722, May 27. 1955) § 237.802 Application to be filed.
No individual, irrespective of his qualifications, shall receive an annuity or lump-sum payment under this part unless, on or before the date of his death, his duly executed application upon such form as the Board may from time to time prescribe is filed with the Board. [Board Order 62-33, 27 FR. 3323, Apr. 7, 1962) § 237.803 Filing date of application.
An application, filed in the manner and form prescribed in § 237.802, for any payment under this part shall be considered filed with the Board on the date it is received at an office of the Board, or the date it is delivered to a field employee of the Board specifically authorized by a regional director to receive applications in the area where delivery is made, whichever date is earlier: Provided, however, That if in the adjudication of an application for a payment under this part it is determined that the applicant died on a day observed by the Board as a non-work day and that his application was received through the mail at an office of the Board on the first business day following such nonwork day, the application shall be deemed to have been filed with the Board on such non-work day if it is established to the satisfaction of the Board that the application was mailed in sufficient time to have been received by the Board in the ordinary course of the mail on such non-work day had that day been a business day. (Board Order 62-33, 27 F.R. 3323, Apr. 7, 1962)
$ 237.804 Signature on application
form. The application form shall be signed personally by the applicant in his usual manner: Provided, however, That if the applicant is unable to sign his me because of physical inability or illiteracy, he shall then make his mark (X) and a witness shall affix the applicant's name. In every case the signature or mark shall either be executed and authenticated in such manner as the form provided may indicate or shall be executed before and authenticated by an employee of the Board duly designated and authorized to perform such services. In the event that the signature or any written portion of the application form is, within the judgment of the Board, substantially illegible or of doubtful authenticity, or, if in the judgment of the Board there are substantial omissions in the application form, the Board may require its reexecution or correction: Provided further, That an application form that is reexecuted because the previous form was either not signed or improperly signed shall be returned and shall be received by the Board within 30 days after notice to correct such deficiency is mailed to the applicant; otherwise, the filing date of the application shall be the date on which such reexecuted application form is received by the Board. (Board Order 62–33, 27 FR. 3323, Apr. 7, 1962) & 237.305 Limitation on filing.
No application for an insurance annuity under this part filed prior to 3 months before the first month for which the applicant becomes otherwise entitled to receive such annuity shall be accepted. (12 F.R. 2026, Mar. 27, 1947] § 237.806 Filing of application.
(a) With Social Security Administration. (1) The claim or application of an individual filed with the Social Security Administration on or after October 1, 1946, for an insurance benefit or a lump-sum death payment under subsection (c), (d), (e), (f), or (g) of section 202 of title II of the Social Security Act, as amended August 10, 1946, based upon the death of an individual who has had service covered under the Railroad Retirement Act, as amended July 31, 1946, shall be deemed to be an application for the corresponding survivor benefit under subsection (a), (b), (c), (d), or (f) of section 5 of the Railroad Retirement Act,