Q. In the context of a 72(t) withdrawal does “annually” refer to a 12-month period or the calendar year? I took my first distribution in a lump sum in July. Can I take the annual amount in 2015 on a monthly basis starting in January or do I have to wait until July and again take a lump sum? My calculation was done using the “fixed amortization method.”
Q. I am 68 years old and retired under Civil Service. Will I be penalized 20 percent if I withdraw my TSP funds in a single payment? Will the federal government withhold federal taxes on the funds before any penalties?
Q. Say I take a TSP partial lump sum and then monthly installments at retirement. In a few years, I need large sums, but understand I can’t take another lump sum. Is there a limit on the amount of monthly payments I can choose? Can I ask, for example, for $50,000 per month until the account is exhausted or I change back to a lower amount?
Q. In trying to maximize my withdrawal options with the TSP, I’m leaving all my money in until age 70-1/2. After I make mandatory withdrawals which TSP will calculate, can I still use the one-time withdrawal option if an emergency arises? A. No.
Q. Years ago, I worked for an aerospace company. Now this company is offering me a lump sum for my pension. Is it possible to directly transfer this lump sum or a portion of the lump sum into my TSP account? A. Probably, if the existing account contains no after-tax contributions. See the instructions for Form TSP-60 for the basic rules of eligibility for transfers into the TSP.
Q. I plan to retire prior to fully repaying my TSP loan balance. If the loan balance is eventually repaid in a lump sum from my TSP account balance, does that count as my one partial lump-sum distribution? A. No.
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.