Form BA-15 - Program Letter

Program
Letter

United States
Railroad Retirement Board
Bureau of the Actuary and Research

Financial Interchange Division
Email: [email protected]
Letter No. 2019-99

Phone: (312) 751-4915
Fax: (312) 751-7129
Date: September 1, 2019

CONTACT: Vincent Lui
Bureau of the Actuary and Research

TO:

(312) 469-2286
[email protected]

Certification Contact Officials

SUBJECT: Form BA-15, Report of Stock Options and Other Payments
Please share this information with the appropriate members of your staff who file service and
compensation reporting forms for employees of your organization.

Background:

A recent court ruling, Wisconsin Central Ltd. v. U.S, 138 S.Ct. 2067 (2018), determined
that non-qualified stock options (NQSOs) are not taxable under Section 3231 of the
Railroad Retirement Tax Act (RRTA) but are still taxable under the Federal Insurance
Contributions Act (FICA). With a narrower definition of compensation under the RRTA,
the amount of payroll subject to tax from a railroad employer will be lower than what it
would have been under the FICA. As a result, the railroad employer must provide
information to the RRB regarding the value of NQSOs separately from a railroad
worker’s reported RRTA compensation to determine the payroll taxes due to the Social
Security Administration and Centers for Medicare and Medicaid Services.
Employers are required each year, by the last day of February, to submit Form BA-15,
Report of Stock Options and Other Payments, for all employees who received NQSOs
payments during the previous year.
Additionally, in Union Pacific Railroad Co. v. U.S., 865 F.3d 1045 (8th Cir. 2017), the
Eighth Circuit Court of Appeals determined whether certain ratification payments were
taxable under the RRTA. If railroad workers have received ratification payments from
the railroad employer that were not included in the employee’s reported RRTA
compensation, include those payments on this Form BA-15. Please consult your tax
advisor for additional guidance.1
1

Note that the IRS has taken the position that it will continue to treat ratification payments as subject to
RRTA. See AOD-2019-02, IRB 2019-4.

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Form BA-15 can be submitted via File Transfer Protocol (FTP), secure E-mail or sent
via CD-ROM, as instructed in filing instructions. The format for the files can be found in
the Excel data file or attached to this letter. See Program Letter 2008-05 for more
information about using electronic file transfer methods.

Paperwork Reduction Act (PRA) Notice
We estimate this form will take an average of 300 minutes per positive response to
complete and an average of 15 minutes per negative response to complete. Responses
include the time needed for reviewing the instructions, getting the needed data, and
reviewing the completed form. Federal agencies may not conduct or sponsor, and
respondents are not required to respond to, a collection of information unless it displays
a valid OMB number. If you wish, send any comments regarding the accuracy of our
estimate or any other aspect of this form, including suggestions for reducing the
completion time, to the Associate Chief Information Officer for Policy and Compliance,
Railroad Retirement Board, 844 North Rush Street, Chicago, IL 60611-1275.

Attachment: Excel data file format

UNITED STATES RAILROAD RETIREMENT BOARD - 2