Browsing: Social Security

Monthly payouts

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Q. Are FERS retirement checks, TSP distribution checks and Social Security checks a monthly or bi-weekly distribution? Is there an option to make requests for either method? A. All are monthly.

Social Security default

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Q. What would happen to FERS retirees if Social Security defaults? I heard rumors that the CSRS folks will still get paid, but the FERS people will not. Another rumor is that the government can take your TSP G-Fund money, but not the other funds. What should federal employees be doing for such a scenario?

Tax withholding

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Q. I’m 68 and still working, and I started drawing Social Security when I turned 66 two years ago. How do I calculate how much taxes will come out of my Social Security, TSP and FERS retirement checks? A. You will find the rules for tax withholding from TSP distributions in the table on Page 3 of the notice at https://www.tsp.gov/PDF/formspubs/tsp-536.pdf.

TSP withdrawal

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Q. I will be 70 in February 2016 and plan to retire and take all my money out of my TSP. I am a single divorced woman and do have monthly security for which I have been paying taxes. Can I take all my money out, as I have calculated that the $1,000 I am from Social Security is not enough for my expenses as I have calculated it. A. Yes, you may take all of your money out. Use form TSP-70.

Social Security reduction

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Q. I’ve read about the Social Security reduction if your income is above a certain amount. Does the calculation for that amount include the FERS pension and TSP annuity payments? In other words, does the Social Security Administration consider my pension and TSP payout to be “income” they will reduce against? Or is the reduction only against “wages” from actual employment income after you reach Social Security retirement age?

Partial TSP withdrawal

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Q. I am 60 and had to retire early due to disability. I am receiving Social Security disability and a small annuity. Can I take a small amount — say, $10,000 — from my account but then start monthly draws when/if it becomes necessary? Should I leave all of my money in this account or do a rollover into a regular or Roth IRA? A. Yes, as long as you have not previously used your single partial withdrawal. I think you should retain your Thrift Savings Plan account for as long as possible.

Early withdrawal penalty

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Q. I will be 52 years old March 9. I am covered under FERS, and I have 31 years of federal service. If my base offers an early-out this year, I plan to take it. I have a substantial balance in the Thrift Savings Plan and would like to withdraw it in its entirety when I take the early-out so I can invest it in my daughter’s business. 1. Will I be penalized for withdrawing my TSP funds early? If so, how much? I know I will be taxed, and I am OK with that. My husband plans to keep…

Special retirement supplement and TSP

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Q. I am looking at retiring in January 2015. I will be 56 years old Oct. 15. I will have 30 years in as of Dec. 24. Waiting until the end of leave year to cash in all available annual leave. I am looking at cashing out my Thrift Savings Plan in a lump sum to pay off all debts. Will that income be considered part of earned income so that the special retirement supplement is reduced? If so, would it be in my interest to retire at the end of 2014 so that my annual leave hits that year…

Using TSP withdrawal to pay off debt

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Q. I am soon to be 65 and plan to retire within the year and have debt in the amount of $67,000. This is not including my home, car, etc. I have been considering withdrawing a large amount from my Thrift Savings Plan to pay this debt. With my pension and Social Security benefits, if I figured correctly, I would be bringing home about what I do now after taxes. I know it’s personal preference, but is it a wise decision? A. I can’t say if it’s the best course of action, but the debt needs to be paid. The…

Special retirement supplement and taxes

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Q. I received a 1099R from the Internal Revenue Service. They do not differentiate the annuity income from the supplement income. I’ve read the IRS Publication 721 tax guide to U.S. Civil Service Retirement benefits. There is no mention of the special retirement supplement. I called the IRS; they said they never heard of the supplement being treated like Social Security. They also advised me to report the income on the 1099R as is (do not separate the supplement from the regular annuity). If it is indeed to be reported like Social Security, how do I go about it without…

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