TSP at age 70 1/2


Q. I am a widow, CSRS, retired.  I will have approximately $55,000 (before taxes) when I am 70 1/2 (January 2017).  My birthday is July 1946.  I am a widow; file single; do not want an annuity.  I know my circumstances and the law could change a lot before then. Would they take 20 percent or 30 percent before giving it to me?  Any suggestions?

A. Under the current rules, if you take a required minimum distribution as a single, partial withdrawal, it will be subject to 10 percent tax withholding unless you elect to have a larger amount withheld. If the Required Minimum Distribution is part of a series of monthly payments, based on your life expectancy, then the default withholding rate is that for a married filer with three dependents, and you may elect to either increase, decrease or waive withholding, altogether.


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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 fedexperts@federaltimes.com and view his blog at money.federaltimes.com.

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