Withdrawing from TSP at 59½


Q. I retired from the U.S. Postal Service in February 2015 at age 57, with 30 years and three months of service (3 years with the military). I did not withdraw any funds from my TSP account. My plans are to withdraw all funds in April 2017 when I reach 59½ years old to pay off debts and purchase income-producing real estate. Are there any tax ramifications and any penalties I would have to pay?

A. You do not need to wait until age 59½ to withdraw your TSP funds without penalty. Any money you withdraw will be added to your tax returns as ordinary income.


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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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