Form CT-2 Employee Representative's Quarterly Railroad Tax Return

Form

CT-2

(Rev. January 2011)
Department of the Treasury
Internal Revenue Service

Employee Representative's Quarterly Railroad Tax Return
▶

OMB No. 1545-0002

Complete both copies of Form CT-2.

1 Taxable compensation paid during this quarter subject to Tier I tax .

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$

×

10.4% (.104)

1

2 Taxable compensation paid during this quarter subject to Tier I Medicare tax

$

×

2.9% (.029)

2

3 Taxable compensation paid during this quarter subject to Tier II tax .

.

$

×

12.1% (.121)

3

4 Credit (attach explanation in duplicate)

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5 Total taxes for quarter (add lines 1 through 3, subtract line 4). See instructions for payment details .

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4

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5

Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief, it is
true, correct, and complete. Declaration of preparer (other than taxpayer) is based on all information of which preparer has any knowledge.

Signature

Date ▶

▶

Be Sure To
Enclose
Your
Check or
Money
Order

Paid
Preparer
Use Only

T
FF

Employee representative’s name, address, and social security number, and name
of organization represented. If incorrect, make any necessary changes.
Print/Type preparer’s name
Firm’s name

FP
I
T

Return for Calendar Quarter
(Months and year)

Preparer’s signature

Date

ORIGINAL
Check
if
self-employed

▶

PTIN

Firm's EIN ▶

Firm’s address ▶

Phone no.

For Privacy Act and Paperwork Reduction Act Notice, see page 2.

Form CT-2 (Rev. 1-2011)

Cat. No. 16030S

Do not cut or separate the forms on this page.

Form

CT-2

(Rev. January 2011)
Department of the Treasury
Internal Revenue Service

Employee Representative's Quarterly Railroad Tax Return

1 Taxable compensation paid during this quarter subject to Tier I tax .

OMB No. 1545-0002

.

$

×

10.4% (.104)

1

2 Taxable compensation paid during this quarter subject to Tier I Medicare tax

$

×

2.9% (.029)

2

3 Taxable compensation paid during this quarter subject to Tier II tax .

.

$

×

12.1% (.121)

3

4 Credit (attach explanation in duplicate)

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

.

5 Total taxes for quarter (add lines 1 through 3, subtract line 4). See instructions for payment details .

.

.

.

.

4

.
▶

5

File this DUPLICATE copy with the ORIGINAL return.

Employee representative’s name, address, and social security number, and name of
organization represented exactly as shown on ORIGINAL, including any corrections.
For Privacy Act and Paperwork Reduction Act Notice, see page 2.

Return for Calendar Quarter
(Months and year as on ORIGINAL)
Cat. No. 16030S

DUPLICATE
Form CT-2 (Rev. 1-2011)

Page 2

Form CT-2 (Rev. 1-2011)
Section references are to the Internal Revenue Code unless otherwise noted.

What’s New
Changes to tax rates and compensation bases. The Tier I tax rate is 10.4% and the
Tier I compensation base remains at $106,800. The Tier I Medicare tax rate remains at
2.9% with an unlimited wage base. The Tier II tax rate on employee representatives
remains at 12.1% and the Tier II compensation base remains at $79,200.

General Instructions
Purpose of Form
Use this form to report railroad retirement taxes imposed on compensation received by
employee representatives.
Railroad retirement taxes. The Railroad Retirement Tax Act imposes a tax on an
employee representative, which is based on compensation.
These taxes are divided into Tier I and Tier II taxes. The amount of compensation
subject to each tax is different.
The Tier I tax rate for 2011 is 10.4%. It applies only to the first $106,800 paid to you
during 2011 for services performed as an employee representative. The Tier I Medicare
tax rate is 2.9%. It applies to all compensation paid to you during 2011 for services
performed as an employee representative.
The Tier II tax rate for 2011 is 12.1%. It applies only to the first $79,200 paid to you
during 2011 for services performed as an employee representative.

Who Must File
As an employee representative, you must file Form CT-2 for the first quarter in which
you are paid taxable compensation for services you performed as a representative.
Continue filing returns for each quarter, even if you are not paid taxable compensation.
When your taxable compensation payments stop completely, file a return marked “Final
Return.”

When To File
Due dates for filing Form CT-2 and paying the tax each quarter are as follows:
Quarter covered:
Due by:
January, February, March
May 31, 2011
April, May, June
August 31, 2011
July, August, September
November 30, 2011
October, November, December
February 29, 2012
If any due date shown above falls on a Saturday, Sunday, or legal holiday, you may
file your return and pay the tax on the next business day.

Where To File
Form CT-2 contains two copies. Be sure to make an additional copy of Form CT-2 for
your records. Send both the ORIGINAL and DUPLICATE to the Department of the
Treasury, Internal Revenue Service Center, Cincinnati, OH 45999-0007.

Penalties and Interest
The law provides a penalty for late filing or late payment unless you can show
reasonable cause for the delay. If you are late in filing a return or paying the taxes, send
an explanation with the return. Interest is charged on taxes paid late.

Records
You must keep records relating to employee representative taxes for at least 4 years
after the taxes are due or were paid, whichever is later.

Definitions
Employee representative. An employee representative is:
1. Any officer or official representative of a railway labor organization that is not an
employer under section 3231(a) who (a) was in the service of an employer and (b) is
authorized and designated to represent employees under the Railway Labor Act and
2. Any individual who is regularly assigned to or regularly employed by an employee
representative as defined above in connection with the duties of the employee
representative’s office.
Compensation. Compensation means payment in money, or in something that may be
used instead of money, for services performed as an employee representative. It does
not include payments for medical or hospital expenses connected with disabilities. It
also does not include payments made specifically for traveling or other bona fide and
necessary expenses that meet the rules in the regulations under section 62. For
purposes of Tier I taxes, compensation does not include sickness or accident disability
payments received (a) under a workers’ compensation law, (b) under section 2(a) of the
Railroad Unemployment Insurance Act for days of sickness due to an on-the-job injury,
(c) under the Railroad Retirement Act, or (d) more than 6 months after the month in which
the employee representative last worked for the railway labor organization.
Compensation is considered paid when actually paid or when constructively paid.
Constructively paid means that the pay (a) has been credited to the employee
representative’s account or set apart with no limit or condition on how or when the
payment will be made and (b) is available to draw on at any time and to control.

Specific Instructions
If you perform services as both an employee representative and an employee and your
total pay for these services is more than the applicable maximum (see Line 1 and Line 3
below), then for lines 1 and 3 subtract your pay as an employee from the maximum to
determine the amount subject to the employee representative’s tax.
Line 1. Multiply the compensation subject to Tier I tax by 10.4% (.104). This applies only
to the first $106,800 paid to you during 2011 for services performed as an employee
representative.
Line 2. Multiply the compensation subject to Tier I Medicare tax by 2.9% (.029). This
applies to all compensation paid to you during 2011 for services performed as an
employee representative.
Line 3. Multiply the compensation subject to Tier II tax by 12.1% (.121). This applies
only to the first $79,200 paid to you during 2011 for services performed as an employee
representative.
Line 4. Enter any credit for an overpayment of tax, penalty, or interest erroneously paid
for an earlier quarter. Attach two copies of a detailed statement explaining the credit
claimed.
Line 5. Pay this amount to the “United States Treasury.” Enter on your check or money
order your social security number, “Form CT-2,” and the quarter (for example, 201101
for the first quarter of 2011). Alternatively, you may pay your tax using the Electronic
Federal Tax Payment System (EFTPS). For more information, visit www.eftps.gov, call
EFTPS Customer Service toll free at 1-800-555-4477, or get Pub. 966, The Secure Way
to Pay Your Federal Taxes.
Signature. You or your authorized agent must sign the ORIGINAL copy of Form CT-2.
Name, address, etc. Type or print your name, address, social security number, and the
name of the labor organization for which you perform services. If the IRS has
preaddressed the form, check to be sure it is correct. If incorrect, make any necessary
changes.
Return for calendar quarter. The IRS usually fills in this space. If it is blank, enter the
months of the quarter and the year of the return. For example, show the first quarter of
2011 as “Jan., Feb., Mar. 2011.”
Paid preparer. A paid preparer must sign Form CT-2 and provide the information in the
“Paid Preparer Use Only” section if the preparer was paid to prepare Form CT-2 and is
not an employee of the filing entity. Paid preparers must sign paper returns with a
manual signature. The preparer must give you the original return to be filed with the IRS
and a copy of the return for your records.
If you are a paid preparer, enter your Preparer Tax Identification Number (PTIN) in the
space provided. Include your complete address. If you work for a firm, write the firm’s
name and the EIN of the firm. You can apply for a PTIN online or by filing Form W-12,
IRS Paid Preparer Tax Identification Number (PTIN) Application. For more information
about applying for a PTIN online, visit the IRS website at www.irs.gov/taxpros. You
cannot use your PTIN in place of the EIN of the tax preparation firm.
Generally, you are not required to complete this section if you are filing the return as a
reporting agent and have a valid Form 8655, Reporting Agent Authorization, on file with
the IRS. However, a reporting agent must complete this section if the reporting agent
offered legal advice, for example, by advising the client on determining whether its
workers are employees or independent contractors for federal tax purposes.
Privacy Act and Paperwork Reduction Act Notice. We ask for the information on
Form CT-2 to carry out the Internal Revenue laws of the United States. We need it to
figure and collect the right amount of tax. Section 3211 and section 6011 and its
regulations require employee representatives to report and pay over to the IRS railroad
retirement taxes (Tier I and Tier II) and Tier I Medicare taxes. Form CT-2 is used to
determine the amount of such taxes that you owe. Section 6109 requires filers and paid
preparers to provide their identification numbers.
Routine uses include giving this information to the Railroad Retirement Board for use in
administering the Railroad Retirement Act, to the Department of Justice for civil and
criminal litigation, and to cities, states, and the District of Columbia for use in
administering their tax laws. We may also disclose this information to other countries
under a tax treaty, to federal and state agencies to enforce federal nontax criminal laws,
or to federal law enforcement agencies and intelligence agencies to combat terrorism. If
you fail to provide this information in a timely manner, you may be subject to penalties
and interest.
You are not required to provide the information requested on a form that is subject to
the Paperwork Reduction Act unless the form displays a valid OMB control number.
Books or records relating to a form or its instructions must be retained as long as their
contents may become material in the administration of any Internal Revenue law.
Generally, tax returns and return information are confidential, as required by section
6103.
The time needed to complete and file Form CT-2 will vary depending on individual
circumstances. The estimated average time is: Recordkeeping, 13 min.; Learning
about the law or the form, 13 min.; Preparing the form, 24 min.; Copying,
assembling, and sending the form to the IRS, 16 min.
If you have comments concerning the accuracy of these time estimates or
suggestions for making Form CT-2 simpler, we would be happy to hear from you. You
can write to the Internal Revenue Service, Tax Products Coordinating Committee,
SE:W:CAR:MP:T:T:SP, 1111 Constitution Ave. NW, IR-6526, Washington, DC 20224. Do
not send Form CT-2 to this office. Instead, see Where To File, earlier.