Q. I am a federal employee with a law enforcement (Department of Justice/Bureau of Prisons) retirement. I am planning to retire at age 51 with 23 years in my current agency, and six years and 11 months military time that has been paid back. This, along with 175 hours of sick leave, should give me a 30+ year LEO retirement. I have been told that if I wait until age 55, I can withdraw my entire Thrift Savings Plan balance during that year and do so without a penalty (before 59½ years of age) as long as I pay the…
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Q. I’m 47 and plan on retiring at 56 with 34 years of service. If I open a Roth Thrift Savings Plan account, can I withdraw all of the money from the Roth account and withdraw a small monthly amount from my traditional account when I retire? The TSP website says I can make withdrawals (1) on a prorata basis between the Roth and traditional accounts or (2) you can separately transfer any portion of your Roth or traditional account to an IRA or other eligible employer plan. I wanted to withdraw all of the Roth money while my husband is still…
Q. I retired from the Navy last year (I have 20 years in) and am receiving my pension. I took a GS-12 job and am under FERS. I’ll be 39 in a few weeks. If I wanted to retire at age 57, what would be my monthly payout? For how long? I understand that there is a three-tier system using the Thrift Savings Plan and Social Security. Am I allowed to draw on those at age 57, or do I have to wait until age 62? Mike Miles: You may begin drawing from your TSP account immediately and without penalty after…
Q. I am a GS employee that is also a member of the Air Guard. I will be leaving on leave without pay to go through military training for roughly five to six months. How will this affect my FERS retirement and my Thrift Savings Plan contributions? Do I have to buy back my military retirement to obtain my FERS retirement contributions during my LWOP? A. Mike Miles: You may not contribute to the TSP while in LWOP status. Reg Jones: You will be on LWOP-US. Therefore, you will have to make a deposit to the retirement system to get…
Q. If I retire after 30 years of federal service at the age of 58, can I start withdrawing my Thrift Savings Plan, or do I have to wait until the age of 59½? I do not have any part of the TSP as a Roth. A. You will be free to withdraw your TSP assets without penalty.
Q. The Internal Revenue Service is penalizing me for withdrawing my Thrift Savings Plan. I am less than 59 years old, but I retired under a Voluntary Early Retirement Authority. It is my understanding that I do not have to pay an early withdrawal penalty because I am retired. Please correct me if I am wrong. I also need to find the regulations for the IRS if I am exempt from paying this penalty. A. Unless you retired during or after the year in which you reached age 55, or meet one of the other special exceptions, your withdrawals will…
Q. Current age: 56 Entered U.S. Navy active duty: May 1978 Active-duty military time: 11 years, four months Retired reservist after 26 years as an O-5 Entered civil service: November 1997 Current paygrade: GS-9, Step 8 Received a $30,000 severance pay when released from active duty in January 1989 Points accumulated, active and reserve, for retirement: 5,245 What do I need to do to retire at the end of this year? I know you can’t tell me what I should do, but if you could give me guidance as to what I need to do so I can make an…
Q. I am planning to retire next year. If Congress extends the Roth rollover provision, I am interested in pursuing the following scenario: I have funds in the Thrift Savings Plan that will be fully taxable upon withdrawal. If I withdraw them upon retirement (at 56), I will be taxed on them but not subject to the 10 percent penalty. I propose to take those funds and immediately (within the same day if possible) transfer them to the CSRS Voluntary Contribution Program account, which then could also allow a rollover into a Roth account. Therefore, am I permitted to fund the…
Q. In IRS Publication 575 on page 33, they list an exception from the 10 percent penalty on withdrawing from the Thrift Savings Plan fund for qualified public safety employees. As a federal agent, if I retire in the year in which I turn 50, am I exempt from the 10 percent early withdrawal penalty based on the qualified public safety employee clause? IRS Publication 721, pages 17-18 lists a law enforcement officer as a qualified public safety employee. If this is the case, why do they not mention this when doing pre-retirement seminars? A. The exception only applies to defined benefit…
Q. I am retiring from the Postal Service in 10 days. I have an outstanding loan for $6,500. I do not have the funds to pay off the loan now, and I need an immediate partial withdrawal for $30,000 when I retire. How do I get this done ASAP? A. Use Form TSP-77 to request a partial withdrawal following separation from service.