Q. Just how is the minimum distribution calculated for the TSP? I understand calculations based on life expectancy tables, but not how the minimum amount is calculated. I am assuming that it would be less than that based on life expectancy. I am FERS and plan to retire in June.
A. In general, the Required Minimum Distribution amount is calculated by dividing the prior year’s ending account value by the appropriate life expectancy factor. There are specific rules that may apply to certain situations, however. See IRS Publication 590 for instructions for calculating the RMD.