Loan taxes


Q. I am considering leaving my federal job but still owe approximately $10,000 back on my TSP loan. How can I figure out if it’s more beneficial to just have the balance count as taxable income vs. taking a bank loan to pay it back?

A. There is no way to know, in advance, which will work out better in the end. You might want to have your tax preparer run pro-forma calculations to see what the impact will be on your tax returns, and make the decision based on that information.


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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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