Q. I plan to retire prior to fully repaying my TSP loan balance. If the loan balance is eventually repaid in a lump sum from my TSP account balance, does that count as my one partial lump-sum distribution? A. No.
Yearly Archives: 2014
Q. I wonder if this plan is viable. I retireg in a couple years with 10 years FERS service and around $200,000 in my TSP. I will be 65 at retirement, but don’t plan to collect Social Security until age 66. My plan is to take a one-time withdrawal of around $50,000 to pay off my mortgage. Following that, I plan to start monthly withdrawals at a rate equivalent to my upcoming Social Security income. When the Social Security payments start, I plan to reduce the monthly TSP collection to a nominal amount until I have to start taking the…
Q. I’m in FERS and am planning to retire at the end of this year at age 57 with 30 years of service. If I take a monthly payment, when do I have to submit my form TSP-70 to ensure I receive my first payment as quickly as possible? I understand the TSP needs to be notified of my retirement before they can provide my monthly payment, but I would like advice on how to time my retirement with my TSP withdrawal. Is the TSP automatically notified when my retirement is official?
Q. I’m confused about the 5 percent agency matching base pay as compared to the $17,500 threshold. After looking at the TSP website and seeing that my agency will only match up to 5 percent of my base pay which comes to about $3,300 roughly. I am currently contributing the max amount of $674 per pay period to get me to $17,500. What would be the benefit of maxing out the $17,500 if the agency is only matching $3,300?
Q. If I retire under the FERS program at MRA and 31 years, I will be age 57. Can I withdraw from my TSP account in monthly installments without the IRS tax penalty? I cannot find this anywhere in the TSP information.
Q. Do any of the TSP funds generate dividends that are automatically added to the account in the form of shares or are the only shares added to my accounts done when I and my employer purchase shares on payday. If certain funds do generate dividends in the form of shares added to my account how do I track them?
Q. Can you transfer Voluntary Contributions into the Roth balance of your TSP account? A. No. Transfers into the Roth TSP are limited to Roth 401k, Roth 403b and Roth 457b plan balances.
Q. I’ve decided that it would be financially advantageous for me to default on my current TSP loan, in order to pay off other, more pressing and expensive debts. My loan payment is currently deducted automatically from my biweekly civil-service paycheck by the Treasury Department. So I have three questions: 1) Is there a mechanism by which I can have Treasury stop making the loan payment/deduction? 2) If so, then if I do so as of Oct. 15, will I be liable for the taxes on the deemed disbursement in this tax year, or in the next tax year? (I…
Q. I will be retiring with a law enforcement 1811 pension. I will still owe $30,000 on a TSP loan. I understand I will have to pay taxes on the loan as they will consider it a pay-out. My question is about the additional penalty that may be involved. I have read under the Pension Protection Act of 2006 (PPA), Section 828, which allows a retired federal law enforcement officer to withdraw funds from their TSP. When the IRS form 1099 reflects the distribution code of “early withdrawal – no known exception, the retired employee can file a form 5329 with the…
Q. If I retire on Jan. 2, can I contribute the 2015 Roth limit to my Roth account?