Ask The Experts: Money Matters

By Mike Miles

Disability retirement

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Q. I am 56 and had to retire under a federal service disability retirement because of cancer. I am also receiving Social Security, and I have 90 percent disability from the Veterans Affairs Department. Can I withdraw from the Thrift Savings Plan without the 10 percent penalty, or do I need to wait until I’m 59? I’ve read that if I am permanently disabled I can waive the penalty. But I can’t find any info as to how I prove permanent disability for tax purposes. I know I can’t work and retired with disability under federal service and Social Security, but is that permanently disabled? The tax documents bounce all over, and it’s difficult to know if I meet the permanently disability requirements. Read the rest of this entry »

TSP complaint

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Q. Please provide me with information on how to file a formal complaint concerning TSP processing of a 401(k) rollover from a previous employer. TSP personnel stated there is no formal procedure for complaints, and participants need to contact U.S. Representatives. Is this correct?

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Military deposit

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Q. I owe $25,000 military deposit. I have $30,000 in a Roth IRA. Can I transfer the money from the Roth IRA to the FERS basic benefit without incurring a penalty? Read the rest of this entry »

TSP rollover

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Q. I’ve got about $340,000 in C, S and I Funds. I have contributed regularly for past 13 years into just the C, S and I. I have $145,000 from a non-TSP balanced fund that I just cashed out of, so I could roll into TSP. Should I roll it all into G fund based upon the current market outlook? My guess is that stock funds are pretty much peaked out and will drop significantly. Might be the one chance I’d want to take at trying to time the market. The plan would be to transfer out of the G fund when the market is low. Read the rest of this entry »

ROTH IRA contribution

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Q. If I were to retire Dec. 31, can the payments actually received in 2015, such as my last paycheck earned in 2014, payment for unused annual leave and buyout, if any, be used to fund a 2015 ROTH IRA?

A. Paychecks constructively received in 2015 can be used as the basis for an IRA contribution to the extent that the income is earned income for this purpose. You annual leave payout is not considered earned income for this, however, and can’t serve as the basis for IRA contributions.


Minimum age for TSP withdrawal

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Q. What is the minimum age I can begin taking withdrawals from my TSP account? And what is the tax/penalty I will incur? I intend to retire from Department of The Air Force with MRA +10 (15 years civil service).

A. While you are employed, you may take a TSP loan or a financial hardship withdrawal at any age, or an age-based withdrawal after you reach age 59 1/2. Once you separate from service, you may withdraw your TSP money at any age, although the 10 percent early withdrawal penalty may apply if you don’t meet one of the exceptions listed on page 7 of the notice at

TSP distribution requirements

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Q. I am 73 years old and still working for a VA Medical Center. Are there any changes in the rules regarding my TSP account? I was recently reading something about receiving minimum distributions from my TSP account. Does this pertain to me since I am still working?

A. The distribution requirements will not apply to your TSP account until you have separated from federal service. See the notice at

TSP deposits

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Q. I am scheduled to retire in November. I am firefighter with 32 years, 6 months of service. I am covered under FERS. I plan to elect the TSP option that will provide me a monthly payment until my death. Do you know if the monthly direct deposit will combine all three (annuity, annuity supplement and TSP) as one payment, or should I expect three separate payments?

A. At least the TSP will come as a separate deposit.

Roll over IRA to TSP

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Q. Prior to the TSP coming into existence, I was doing a yearly IRA deposit. I can retire at anytime with over 80 percent of my high three. So, would it be prudent of me to roll this IRA into my TSP account?

A. Yes.

Forgotten TSP

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Q. My father retired about 18 years ago at age 62. He was in CSRS, but he accumulated about $40,000 in TSP. He is now almost 80 and is near death and says he forgot about his TSP. I’ve been reading about TSP and how you must start making distributions at age 70 1/2. What can my mother do to recover this money? I found a form (TSP-70-A) that my dad might be able to fill out if he lasts another week or so.

A. You should review the notice at and submit form TSP-70-A on behalf of your father. Unfortunately, there will be hefty penalties to pay for failing to make the required minimum distributions, when due.