Q. I am separating from a covered law enforcement position after age 50, but before I attain retirement eligibility. I have an outstanding TSP loan that will become an early distribution. My understanding is that I will not be subject to the 10 percent penalty, but will pay income taxes on it. Can you confirm if this is correct? Also, I have a military TSP and will continue to contribute to it. Can I assume the loan repayment using those funds to avoid the distribution?
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Q. I’m only 26 years old, with nine years of federal service. I recently was forced to resign due to unforeseen circumstances. After I pay off the outstanding balance on a TSP loan, and request a full withdrawal (single payment), to what percentage of my TSP balance am I entitled?
Q. Just got medically retired from the National Guard and was also retired from Defense Department technician service. I applied for a TSP loan while waiting for pension paperwork to be processed. I was denied because I’m no longer an employee. Is there an exception for retirees under 60?
Q. Do you have a follow-up on a way to leverage a TSP loan? I thought it might be a good idea to take out a loan against the TSP and put it into a real estate investment trust such as MTGE or CIM that pays pretty good dividends and have those dividends pay back the loan payments. Do you have any articles about leveraging a loan against the TSP?
Q. I have a Traditional IRA and a Roth IRA outside of the TSP. I am maxing out my annual TSP contributions and my annual catch-up contributions. Am I able to transfer both of the outside IRAs into the TSP without affecting my annual contribution limits?
Q. I about to start working as a new federal employer soon. When I do join the federal agency, I’m deciding if I should roll over my 401(k) from my previous employer to my new TSP account. The question that I have is if I need to take a loan on my TSP, would the funds I roll over to my account be eligible for a general or residence loan?
The Department of Labor recently enacted a rule requiring that “advisers” — meaning investment and insurance sales people — who offer “advice” to participants about their retirement accounts act as fiduciaries and accept the responsibility and liability that goes along with that role. In simple terms, this means that anyone who tells you to do something — anything — with your Thrift Savings Plan money, is obligated to put your interests ahead of all others. This poses a rather unpleasant problem for the “financial services” industry, which has built a massive profit generating machine upon a foundation that includes, as…
Q. I understand that I can take a TSP loan just prior to retirement, not pay it and have it become a taxable distribution after 90 days. If the 90 days fall after the first of the year, will the tax be on the new year income or at the time of the loan? I’m a rehired annuitant, if that matters.
Q. My question is about having a TSP loan at time of retirement. I understand that if you don’t pay in full within 90 days, it is dispersed as income and subject to taxes and penalties. When it is dispersed, does it count as one of your allowable withdrawals?