Q: I joined the federal government more than three years ago. Can I roll over money from my Individual Retirement Account into my Thrift Savings Plan account? A: Yes, as long as long as your IRA doesn’t contain basis — that is, money that’s already been taxed.
Q: I am retiring next month and am not interested in assuming risk in my retirement funds at this time. Would be best to roll over Thrift Savings Plan funds into an Individual Retirement Account, or should I leave the money in the TSP? I currently have 50 percent of my money in the G Fund and 25 percent in the C and S Funds. A: Your interests will be best served by leaving your money in the TSP as long as possible.
Q: Can a new federal employee roll over a pre-tax 401(k) from a private-sector job into the Thrift Savings Plan? A: Yes.
Q: I am just about to retire from the FBI, where I’ve worked for 30 years. My parents left me a stock portfolio which dates back several decades. I would like, after retiring, to find and purchase a home using the stock portfolio, which is held in a trust my parents set up for me. I have never purchased a house, and I am wondering if there is any way to get around the capital gains taxes that probably would eat up huge chunks of the value of the stock portfolio once I liquidate most of the stocks to purchase…
Q: I worked for the federal government for about 12 years. When I left, I used some of my Thrift Savings Plan money as a down payment on my current home. That turned out to be a good move, since I bought when the market was down and my home’s value has gone up. However, with the recent downturn in the market, my parents have lost a tremendous amount of money and are in financial need. I would like to give them the remaining money in my TSP account (about $10,000). Is there any way to roll over my TSP…
Q: The TSP website states that there is not a 10 percent penalty for early withdrawal if the withdrawal is made in a year that you have deductible medical expenses over 7.5 percent of your total income. If I made a withdrawal of $20,000 and my total income was $32,000, would there be no penalty at all? Seven and a half percent of $32,000 is $2,400. If my medical expenses were $4,400, would there not be a penalty, or would I have to pay a penalty on $18,000 {4,400-2,400 = 2,000} A: As I understand the rules, the early withdrawal…
Q: I am planning to retire at MRA +10. I will be 56 1/2 years old. Will I be allowed to draw month distributions from my TSP account without penalty? If so, does this include no early withdrawal penalty from the IRS? A: Under the current rules, you will be allowed access to your TSP account without penalty after you retire.
Q: I am about five years from retirement under CSRS. I would like to take out a TSP loan to purchase a used car and to pay off a high-interest credit card balance. It seems to make sense to me since the interest rate is at 3.25 percent (G-fund). By being able to set the terms of the loan, I plan to have it paid off well before retiring. Does this make sense? What is the downside for my TSP account as I head toward retirement. A: You’ve explained your plan. I can’t tell you whether it’s the best option…
Q: I turn 49 in October. When can I start making catch-up payments to my TSP? Can I start the day after I turn 49, do I have to wait until Jan. 1, 2011 (since I turn 50 in 2011) or do I have to wait until I turn 50 in October of 2011? A: You can start them on or after January 1, 2011.
Q: I’m a FERS federal employee with almost 20 years of service. I’m 55 yrs of age and married. I’d like to retire in about seven years. At this stage, can you recommend a TSP allocation? A: The appropriate allocation will depend on your objectives and circumstances at the time, and can change through time. I can’t responsibly provide this kind of personal advice without the proper information and analysis.