Q. I am retired CSRS. I was born Nov. 15, 1942. Therefore, I’ll be 70½ on May 15. 1. When will I have to start taking payments from my Thrift Savings Plan account? 2. Can I wait until January to March 2014 before I get my first payment? 3. What is the minimum I will have to take? 4. I do not want a total lump-sum payment. 5. Do I have to take a monthly payment, or can I get my minimum payment once a year? 6. What form do I need to submit to get minimal payments each year? 7. Can…
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Q. I have to withdraw my Thrift Savings Plan because of my age (70½). I am indecisive as to: 1. Withdraw all to a saving account 2. Get a partial withdrawal for 120 months, or 3. Withdraw part of it and gradually withdraw the rest over a 10-year time span. My considerations are: 1. No taxes, as I understand it, over a period greater than 10 years on a gradual withdrawal 2. Putting me into a higher tax bracket. What advice or comments can you give me? A. Unless you can come up with a good reason – that is,…
Q. My age is 52. I worked 22 years in the Postal Service. I have a Thrift Savings Plan account and am now retired due to a disability. If I make a full withdrawal, will I be penalized? A. Yes, unless you qualify for one of the exceptions listed on Page 7 of the notice at https://www.tsp.gov/PDF/formspubs/tsp-536.pdf.
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,…
Q. I am a FERS employee who will turn 70 in September. I fully expect to be working at 70½. Will I be required to take the minimum withdrawal from my Thrift Savings Plan account if I’m still working? A. As long as you are still working for the federal government, distributions from your TSP account will not be required.
Q. What types of funds can be used to buy back military service time (nonqualified, qualified, Thrift Savings Plan account funds, IRA funds)? A. Only after-tax money can be used, so you can’t use TSP, IRA or 401(k) money for this unless you withdraw it and pay the tax bill first.
Q. I will have over 30 years of service when I reach my minimum retirement age of 57. If I retire and start withdrawing Thrift Savings Plan money, will I pay an extra tax for taking out payments before age 59½? A. No.
Q. Can I withdraw my total funds from the Thrift Savings Plan without penalty at age 62? A. Yes.
Q. I am 60 years old and, for seven years, have been separated from 21 years of federal service. I have never made any withdrawals from my Thrift Savings Plan account. I am interested in making a partial withdrawal for home improvement projects. I understand a one-time partial withdrawal leaving the rest in TSP for later is allowed, but does one-time mean that if I make a one-time partial withdrawal now, I will not be allowed to make a full withdrawal of the remaining money later when I am fully retired to perhaps pay off the mortgage? Will I only be allowed monthly…
Q. If I contribute $40,000 to my Roth TSP account, it grows to $60,000 and I subsequently leave government service and roll that Roth TSP into a Roth IRA, wouldn’t I be able to immediately withdraw up to $40,000 without tax or penalty, even though I’m less than 59½ and have not had either account for more than five years? A. Yes, it is possible to withdraw your contributions at any time without tax or penalty.