Ask The Experts: Money Matters

By Mike Miles

Rolling TSP into IRA

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Q. Can you elaborate more on the “Ask the Experts” answer at http://blogs.federaltimes.com/federal-money/2011/02/16/rolling-a-portion-of-tsp-balance-into-self-directed-ira/.  The answer seems to imply that under some circumstances, Thrift Savings Plan funds can be rolled over into self-directed IRAs. Can you explain the circumstances under which it’s legal, and can you provide references? I’d like to create a self-directed IRA for my husband, who is 45 years old and no longer in federal service, and then use the funds to purchase a rental property, with the monthly rents going directly into the IRA.

A. Rollovers are allowed for TSP participants who are no longer federal employees or who are over age 59½. He’ll need to fill out the appropriate TSP withdrawal request form (TSP-70 for a full withdrawal or TSP-77 for a partial withdrawal) and direct the distribution to the IRA custodian of his choice.

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