By Mike Miles
August 29th, 2014 | TSP withdrawal
Q. I am under FERS and contribute the maximum amount into TSP. When I am eligible to retire (57-1/2), do I have to immediately start collecting out of my TSP once retired, or can I roll it over into another bank or institution into a 401K without penalty? And how does one receive payments if I can’t roll it over?
A. You will not have to begin taking distributions from your TSP until you reach age 70-1/2. You may, and should retain and manage your TSP for as long as possible — hopefully for life. You may take a single partial lump-sum withdrawal from your account using form TSP-77 and request regular monthly distributions using form TSP-70. You may roll over any TSP distributions you take, except for Required Minimum Distributions, but if you roll your account over to an IRA before you reach age 59-1/2, you will be subject to the Early Withdrawal Penalty.
Comments are closed.