§3241 Determination of Tier 2 Tax Rate Based on Average Account Benefits Ratio

Summary

Sets the yearly tax percentages for three railroad retirement taxes based on a number called the average account benefits ratio. If that average is less than 2.5, the rates are 22.1% (for sections 3211(b) and 3221(b)) and 4.9% (for section 3201(b)). For 2.5–3.0 the rates are 18.1% and 4.9%; 3.0–3.5 → 15.1% and 4.9%; 3.5–4.0 → 14.1% and 4.9%; 4.0–6.1 → 13.1% and 4.9%; 6.1–6.5 → 12.6% and 4.4%; 6.5–7.0 → 12.1% and 3.9%; 7.0–7.5 → 11.6% and 3.4%; 7.5–8.0 → 11.1% and 2.9%; 8.0–8.5 → 10.1% and 1.9%; 8.5–9.0 → 9.1% and 0.9%; and 9.0 or more → 8.2% and 0%. Average account benefits ratio — the 10-year average of the yearly account benefits ratios, rounded up to the next 0.1. Account benefits ratio — a yearly measure that compares the fair market value of the railroad retirement assets to the benefits and administrative payments for that year. The Secretary must publish the next year’s rates in the Federal Register by December 1 each year.