2 TSP withdrawals in same year


Q. I will be 70 1/2 on Dec. 11, and due to state income tax regulations I will be taking my 2016 and 2017 TSP withdrawals in 2017. It appears that I cannot take a yearly distribution but must take monthly payments. How will that work for 2017 when I will be taking a distribution for two years at two separate times? Is there anyone I can visit in person to help in filling out the forms?

A. There is more than one way to get this done, but I suggest that you consider the following: In 2017, you file form TSP-70 to request a mixed withdrawal — part lump-sum and the rest in monthly payments, either based on your life expectancy or in a fixed monthly amount. Request a lump sum that is large enough to satisfy the 2016 RMD. Once you have requested the monthly payments, the TSP will make sure that your RMD is met each year, including 2017, by issuing a makeup distribution at the end of the year, if necessary.


About Author

Mike Miles is a Certified Financial Planner licensee and principal adviser for Variplan LLC, an independent fiduciary in Vienna, Virginia. Email your financial questions to fedexperts@federaltimes.com and view his blog at money.federaltimes.com.

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