Ask The Experts: Money Matters

By Mike Miles

VERA and penalty-free lump-sum TSP withdrawal

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Q. If I receive a Voluntary Early Retirement Authority from the U.S. Postal Service, can I take a lump-sum withdrawal from my Thrift Savings Plan without paying a penalty? I am 57 years old with 27 years of service.

A. Yes.

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Comments

  1. Phil Brown Says:
    July 15th, 2012 at 9:18 am

    I recently did this andwas told the folling, ” If you are younger than 59 and one half you will be charged a penalty of 10%. In addition you will be charged a 20% backup witholding for fed taxes. If 59 and one half or older, you just get hit with the 20% tax witholding.

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