Browsing: TSP contribution

Q. Can a deceased spouse’s TSP account be rolled into the survivors existing TSP account? A. From the brochure “Your TSP Account”: If you have an existing TSP account from your own employment with the federal government or the uniformed services, you can move your beneficiary participant account into your existing TSP account. The money that you move will be treated as an employee contribution, but it will not be subject to the Internal Revenue Code (IRC) annual elective deferral limit, which limits the amount of regular tax-deferred and Roth contributions you can make to the TSP in a calendar…

Q. I am scheduled for full/voluntary retirement in February 2023. I currently have my TSP contribution at 100 percent in the L2030 fund. I am getting a little nervous about the volatility of the market, so I am inclined to do something like reallocate to 50 percent L2030 and 50 percent G Fund just to try and mitigate any potential losses. Of course, I would like to increase my current $253,000 balance, but wouldn’t be averse to it not increasing that much by retirement. Conversely, I would hate to see a loss on what I have and not be able to…

Q. My ex-husband has given me the forms to receive money from his TSP account, but what form do I use to roll it over into my IRA account?  A. The distribution request form should contain a section where you can direct the proceeds to be paid to your IRA custodian for your benefit. If not, you’ll have to roll the funds over yourself using your IRA custodian’s deposit form.

Q. Which would be more advantageous to reduce my annual federal tax bill: contribute more into TSP or withhold more and have more from my salary go toward federal taxes? Am I correct that contributing more into TSP would go toward retirement savings, reduce my taxable income and lower my federal tax bill? A. It’s impossible to say which will be “best.” One is prepaying your federal taxes, and the other is deferring income tax from the current year into a future year. If you can do both, do both. If you can only do one or other, then pay…

Q. In your May 7, 2018, “Money Matters” blog you provided information concerning the rollover of CSRS Voluntary Contribution Program (VCP) funds into a Roth IRA. Can the contribution portion of such funds (non-interest, after tax portion) be rolled over into the Roth TSP? Form RI 38-124, referenced in your earlier column, suggests not, but the most current version of that form predates the creation of the Roth TSP. Such a rollover would be particularly attractive in light of the ability to designate TSP withdrawals as traditional, Roth or a proportional amount of each, with the new withdrawal flexibilities coming to…

Q. If I retire from civil service (under FERS) and I return to work as a civil servant at a later date, I know that my annuity will be subtracted from my pay. However, will I be able to contribute to TSP again? If so, can I contribute to my original TSP account or would I have to start over with another account? A. You will allowed to contribute to the TSP for during any period of eligible employment under TSP’s rules: https://www.tsp.gov/PlanParticipation/EligibilityAndContributions/index.html. A new TSP account will be opened for you when your are eligibly employed.

Q. I currently make the maximum and catch-up contributions to my TSP account and plan on retiring after 20 years of service as a law enforcement officer. I have a traditional IRA and also make the maximum yearly contribution with the idea of rolling this into my TSP post-retirement. Can I continue contributing to the IRA after I separate from government service, if I continue to earn income, then roll it into my TSP anytime post-retirement? A. Yes, although transfers of post-tax IRA money (from non-deductible contributions, usually) into the TSP is not allowed.

Q. I work for the Centers for Medicare & Medicaid Services and am currently 65 years old. I started working for the federal government on July 4, 2010. The plan is to continue working as long as I can, past 70. When I retire it will be under FERS (born Sept. 12, 1953). Do I start taking Social Security at age 70 if I’m still working? Also, can I continue putting money into my TSP after age 70 and 1/2 (the required minimum distribution age)? Are there any other things I should be aware of if I retire after age…

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