Q: I plan to retire in 2015 under FERS at age 56 with 31 years of service. Can I withdraw all my money I have in TSP ($500,000) at once, or is there a limit on how much can be withdrawn? I believe because I have the correct MRA, there would not be a penalty for withdrawal. Is this correct?
A: You may withdraw all of your money at once after you separate from service. Your MRA has nothing to do with it.
But a $500,000 TSP withdrawal all at once would be taxed as income, right? The highest tax bracket right now, I believe is 33%, so you would owe the IRS about $166,000.