Important changes to TSP withdrawal options

  Important changes to TSP withdrawal options

Did you realize that a new law has been passed that pertains to TSP withdrawal options. Although please note the law has been passed, but the new options are not yet available and it could take up to two years for them to become available. One important change is: Currently, when you take a withdrawal, the money comes from your traditional and Roth balances on a pro rata basis. For example, if 80% of your account is in your traditional balance and 20% is in Roth, any withdrawal you take will be 80% traditional and 20% Roth. Under the new rules, you can still use this method, but you’ll also have the option to take your withdrawal only from your Roth balance or only from your traditional balance. These options will be available for all types of withdrawals. Read the TSP Q&A relating to the changes at: https://www.tsp.gov/PDF/formspubs/tspfs10.pdf

Reference: NPMHU 317