Q: I will reach age 70 ½ on March 31, 2011. I understand that I must begin withdrawal from my Thrift Savings Plan [and rounded over IRA]by January 2012. I plan to continue to work in my present position for the federal government after January 2012 up until April 2013.
1. Am I required to begin to withdraw my combined TSP/IRA in January 2012, or may I delay withdrawing these funds until I stop working in April 2013?
2. What law, directive, statue says so?
3. If I am required to begin withdrawal in January 2012 but continue working until April 2013, must I still contribute to the TSP and will the government continue their matching contribution?
4. How will this affect my balance, withdrawal, etc if I continue to contribute while at the same time withdrawing funds?
5. May these two “funds” be combined or are there different rules for the government [TSP] and nongovernment [IRA] when it comes to minimum withdrawal age?
A: If you are still employed, you will not be required to begin distributions from your TSP account until you retire. You should transfer your IRA account balance into your TSP account prior to reaching age 70 1/2 to avoid the minimum withdrawal requirement while you continue to work. Besides, it’s likely to be the best place available for your retirement investment.