Q. If I take out $380,000 from my TPS upon retirement to pay off my mortgage, how much tax liability will I have? I will be 63½ years old, and have a total somewhere around $475,000 in my TPS account. Can I use these funds for a mortgage payoff?
A. Your withdrawal will be added to your tax returns, and taxed, as ordinary income. You may use the proceeds for anything you like.