Q. I had withdrew money from my TSP in 2013 and incurred a tax bill. I was told that you now can take a lump sum without penalties. Can you elaborate on this? Also, what can I do, if anything, if I have paid the taxes and penalties? I was FERS for my entire time with the government.
A. You’ll find the exceptions to the penalty on early withdrawals (before you reach age 59½) on Page 7 of the notice at https://www.tsp.gov/PDF/formspubs/tsp-536.pdf. These exceptions are only useful if they apply to your case at the time the withdrawal is made.