TSP withdrawal

0

Q. I turned 70 ½ years old in December 2017. I retired Jan 31, 2018. I am just in the process of applying to withdraw my first Required Minimum Distribution from my Thrift Savings Plan, and decide in a few months what to do with the rest of the money. How can I show that is my intention, if the form I am given to fill up is the TSP-70 (Request for Full Withdrawal)? Also, I have already done a one-time withdrawal in 2013 from my TSP account. Now that I am retired, after I am issued the first RMD, can I transfer the rest in the account to a Roth IRA? If so, when will I be taxed? If it is in a Roth IRA account already, can it be annuitized?

A. There is no need to indicate your intention to satisfy the RMD. Once you file form TSP-70, the TSP will ensure that your RMD is satisfied each year. After you have filed Form TSP-70, you may withdraw the balance of your TSP account by filing Form TSP-79. This form provides you with the opportunity to transfer the final distribution to a Roth IRA. Any taxable distribution will be taxed during the year when it is processed when you file your tax return for that year.  You are free to use your accessible money, IRA or otherwise, to buy an annuity.

Share.

About Author

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.

Leave A Reply