TSP full withdrawal


Q. I retired from the United States Postal Service at 65 and have a one-time/full withdrawal of my TSP that has a withholding of 20 percent. Is the amount I received still subject to tax for next year’s return and how much?

A. Withholding is not the same as tax due. I suspect that you withheld tax in one year – when the distribution was processed – and will owe the tax when you file your return for that year during the following year. Your withheld funds will be credited against your tax liability, when it is calculated.


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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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