Q. I retire next August. If I start taking monthly withdrawals, will I ever be able to make the one-time withdrawal for something big that might come along and keep the monthly payments. Or do I have to take it before the monthly payments start?
Q. I am 56 and have been drawing on my TSP by monthly payments (not annuitized)for 2-1/2 years. I am getting divorced and having to split assets. My understanding is that you can’t switch to lump sum after starting monthly payments until 59-1/2. However, divorce being a life event, does the TSP allow you to choose a lump-sum option to the TSP owner once assets are split by court order? A. You may end your monthly payments in a full and final lump-sum distribution at any time.
Q. Upon retirement, can I elect to take a full withdrawal in the form of monthly payments, and then at some later date choose to take a one-time lump-sum withdrawal? For instance, three years after retiring, can I choose to remove $50,000 if I have never taken a lump-sum amount. A. Only if the lump-sum is the entire balance remaining in your account.
Q. I am federal employee and plan to retire in about six months or a year. I want to leave the money in TSP when I retire, but want to include TSP in a living revocable trust. I read online that it is not a good idea because the IRS considers that as a lump-sum transfer and I will be taxed at almost 35 percent. But when I consulted an estate-planning attorney, I was told that I can include TSP in the trust, and it does not make any difference in how I withdraw the money. I am confused. Please…
Q. How do I request a TSP partial lump sum after age 59-1/2? What forms do I need to fill out, and how long does the process take? I plan to keep working until age 63 and continue contributing to my TSP. A. Use form TSP-75 to request an age-based, in-service withdrawal. Allow weeks for the withdrawal to be processed.
Q. I retire in less than a month under FERS. As soon as I retire, I plan to use the option to withdraw my TSP in monthly increments that I decide every year (I am not using the life expectancy or annuity options). I also want to do a partial withdrawal (not much of it, just enough so I have a good savings account to fall back on). I know I can only do it once. I assumed, or read, that the one time had to be immediately upon separation. I do not really need the partial-withdraw funds right away,…
Q. I would like to take $3,000 monthly from my TSP when I retire for the first few years, then I start collecting Social Security can I reduce my monthly payment? Then later on change the monthly amount again? I thought I read I can change my TSP payment once a year, but have been hearing from others who have retired you only have a choice of lump sum, annuity, partial lump sum and the rest in monthly payments of your choice, but it stays the same for life.
Q. I’ll retire under FERS at the end of this year. Will the lump-sum payment for annual leave that I’ll receive early in 2015 would be considered earned income for the purposes of being able to contribute to my non-TSP Roth IRA? A. No.