Taxes, penalties for cashing in TSP


Q: I plan to retire at the end of December 2009, and am thinking about cashing in some or all of my Thrift Savings Plan in 2010. I am on the Federal Employees Retirement System and I turned 62 this year. How much will I be penalized by TSP? I know I will pay income taxes on it in 2010, but I am wondering if I’ll get penalized, as well.

A: You’ll pay taxes, but no penalties.


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Mike Miles is a Certified Financial Planner licensee and principal adviser for Variplan LLC, an independent fiduciary in Vienna, Virginia. Email your financial questions to and view his blog at

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