Browsing: Medicare

TSP withdrawal and Social Security

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Q. I will retire at the end of this month. Already set the Social Security deal and retirement paperwork. If I retire now (tax year 2013) and ask for a big chunk of my Thrift Saving Plan in February (tax year 2014), will it affect my Social Security payment (as a windfall or any other way)? A. Not directly, but it can affect the cost of Medicare Part B. You should consult a tax adviser (who will prepare your return) before you proceed, if you’re not sure.

Taxation of lump-sum annual leave payment

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Q. I understand that the lump-sum payment for unused annual leave is treated as wage and salary income and is subject to federal and state (if any) income tax, FICA (Social Security) and Medicare taxes. How is it treated for Thrift Savings Plan purposes? Are individual and government matching contributions made? Can a retiring employee top up their contributions from the lump sum (up to the IRS-determined maximum)?

FERS and NAF

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Q. Overview:  I began in the Air Force Non-Appropriated Fund in 1996, enrolled in NAF retirement plan in 2000, ported to GS in 2005 with deferral of my NAF retirement (calculated at 5.27 yrs) and entered FERS. My current GS position will be abolished in 2014 (at nine years FERS). I have the potential of porting into a NAF position. I wish I had just retained NAF retirement, but lack of research and misguided human resources recommendations led me to where I am with a split retirement outlook. Given my FERS time will total only nine years at abolishment, if I move…

Social Security and tax deductions from annuity and TSP

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Q. When I retire, I will be 59½ and will have 30 years of service at the Postal Service. I will not have any earned income from that point on. I understand federal and state taxes will be taken out of my FERS annuity and any money I take out of my Thrift Savings Plan. Will I also have Social Security deducted from these two sources? Also, will my special retirement supplement and — when I turn 62, my SSI benefit — also be subject to federal and state taxes? A. Mike: Your TSP withdrawals are subject to income taxation,…

12 questions on VERA

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Q. I am a letter carrier, age 52, started in 1985 and have 28 years of creditable service. If I understand what I’ve gleaned from the posts here and the Postal Service were to offer me a Voluntary Early Retirement Authority this year, 1.  Would I begin my annuity immediately? 2.  Would I have no reductions in calculations of my annuity? (average high-3 x 1 percent x 28) 3.  Would I receive credit for half of my sick leave and all of my annual leave? (How are these applied?) 4.  Would I receive the special retirement supplement beginning at age…

Long-term care insurance

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Q. If I have Medicare and Blue Cross/Blue Shield, is there any need to obtain long-term care insurance? A. There might be a need since Medicare and BC/BS medical insurance provide very limited benefits for long-term custodial care.