Comments on: What Should You Do with your TSP When You Leave the Service?

By: Ryan Guina

Ryan Guina — Wed, 11 Jan 2012 12:51:37 +0000

Jason, The dividends don’t disappear. When your funds are in the TSP, they are automatically reinvested for you. If you transfer your funds out of the TSP, then everything is cashed out and you roll the funds into a new investment. Because there are no old funds on the TSP, there is no longer anything that can earn a dividend.

By: Jason

Jason — Wed, 11 Jan 2012 02:35:39 +0000

Ryan
What happens to all the dividends from the stocks? I have never received one from TSP but I do from my IRA. Where do they disappear to?
Jason

By: Ryan Guina

Ryan Guina — Sat, 07 Jan 2012 17:55:17 +0000

Sandi, Thanks for sending in this question. To be honest, I’m not sure what the answer is. I recommend speaking with your HR representative in the civil service. They should be able to answer this question.

By: Sandi

Sandi — Sat, 07 Jan 2012 16:37:39 +0000

Great advice! I am a FERS employee and a Reservist. I have a Uniformed Service TSP account and would like to use some of the money to buy-in to my FERS Annuity. Can I do this without having to pay taxes on the money?

By: Ryan Guina

Ryan Guina — Tue, 30 Aug 2011 04:24:38 +0000

Rafael, here are the TSP vesting requirements, according to Wikipedia:

Vesting Requirements: All employees or service members are fully vested in their contributions and any earnings thereon from the first day of employment or service. FERS employees are also fully vested in agency matching contributions and any earnings thereon from the first day of employment. However, most FERS employees must complete three years of Federal civilian service (some positions require only two years) to be fully vested in agency automatic contributions and any earnings thereon.

Based on that information, you should be able to withdraw all matching contributions. Keep in mind, however, that if you are under the minimum age limit for withdrawals, that you may be required to pay early withdrawal penalties and taxes on your withdrawal if you don’t roll over your TSP into an IRA, another employer sponsored retirement plan such as a 401k, or a different qualified plan. The article covers more of these options in better detail.

By: RAFAEL

RAFAEL — Thu, 25 Aug 2011 01:36:23 +0000

hELLO, i WAS WONDERING. if I leave my federal job and therefore the military and want to withdraw all my money. Are we talking about everything that is on the tsp including what they matched or juast what I contributed? Please answer that for me I am a little confused!

By: Ryan Guina

Ryan Guina — Sun, 14 Aug 2011 13:29:48 +0000

Luke, unfortunately it isn’t possible to roll over your TSP while you are still on Active Duty. You can only roll over the funds once you leave the service.

By: Luke

Luke — Sun, 14 Aug 2011 12:43:21 +0000

Is it possible to rollover your TSP account into a Traditional IRA while still on Active Duty? I fully understand the benefits of the TSP (low fees mostly) but I no longer wish use their limited investment options. Thanks.

By: Ryan Guina

Ryan Guina — Wed, 20 Jul 2011 04:09:36 +0000

Bill, this is my understanding as well.

By: Bill

Bill — Wed, 20 Jul 2011 04:05:52 +0000

I think some may be confused or it is just me? The money contributed to TSP while in a combat zone is Tax Exempt! The profits made from those funds are not exempt only deferred. Basically when you are eligible to withdraw from TSP the only amount that is exempt are the funds you contributed in a combat zone. Each are proccessed through TSP on seprate tax forms as well. Please correct me if I am wrong…

USMC Ret…