Critical Aspects of TSP Installments Sponsored By:Jeff Boettcher

There’s a lot to understand about Thrift Savings Plan installment payments. The 12 elements listed below are among the most crucial.
1)   You may make your installment payments at three different intervals: monthly, quarterly, and yearly. Before the passage of the TSP Modernization Act, installment payments were only accessible monthly. Monthly payments will continue to be the most popular interval since retirees get both their FERS pensions and Social Security payments once a month; receiving monthly payments from the TSP makes sense as well.
2)   Federal income taxes are deducted on installment payments that’ll last more than ten years and also on life expectancy-based payments as if you’re married, filing jointly, and claiming three dependents. As a result, taxes are significantly under-withheld, potentially triggering the estimated tax penalty. If you plan to take payments that will last more than ten years, make sure to have additional money withheld for federal income tax withholding.
3)   Federal income taxes of 20% are withheld from installment payments that’ll less than ten years. You can ask for more to be withheld, but not less.
4)   The TSP doesn’t withhold state income taxes. If you reside in a state where retirement income is taxed, make sure to make estimated payments to your state’s taxation authorities.
5)   Any TSP withdrawal requires the written and notarized approval of your spouse.
6)   Installment payments can be made in a specific amount or as per the IRS Uniform Life Expectancy Table.
7)   Payments can be paused or resumed at any time. However, you’re not permitted to switch from fixed-dollar payments to payments based on the life expectancy chart.
8)   Payments estimated to last less than ten years are eligible rollover distributions. Payments estimated to last ten years or longer are considered periodic payments and cannot be rolled over.
9)   Unless you indicate otherwise, installment payments will be split proportionally between your traditional and Roth balances, like all other withdrawals.
10) You can change your payments’ source (i.e., Roth or conventional balances) at any time.
11) You cannot choose the funds from which your payments are withdrawn. All TSP withdrawals, regardless of type, must be made in proportion to your account allocation.
12) Installment payments are the most common method of TSP withdrawal.

Contact Information:
Email: [email protected]
Phone: 8007794183

For over 20 years, Jeff Boettcher has helped his clients grow and protect their retirement savings. “each time I work with my clients, I’m building their future, and there are few things that are more important to a family than a stable financial foundation.”

Jeff is known for his ability to make the complex simple while helping navigate his clients through the challenges of making the right investment decisions. When asked what he is most passionate about professionally, his answer was true to character, “Helping my clients – I love being able to solve their problems. People are rightfully concerned about their retirement income, when they can retire, how to maximize their financial safety and future income.” Jeff started Bedrock Investment Advisors for clients who value a close working relationship with their advisors.

A Michigan native, Jeff grew up playing sports throughout high school and into college. While Jeff is still an ‘aging’ athlete, Jeff will take more swings on the golf course than miles running these days. He creates family time, often with weekly excursions to play golf, a hobby he shares with his three young children.

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Although we make great efforts to ensure the accuracy of the information contained herein, we cannot guarantee all information is correct. Different types of investments involve higher and lower levels of risk. There is no guarantee that a specific investment or strategy will be suitable or profitable for an investor’s portfolio. There are no assurances that a portfolio will match or exceed any particular benchmark. Any comments regarding guarantees, safe and secure investments, guaranteed income streams, or similar refer only to fixed insurance and annuity products. They do not refer, in any way, to securities or investment advisory products. Fixed insurance and annuity product guarantees are subject to the claimsâ€paying ability of the issuing company and are not offered by BWM Advisory, LLC. Guaranteed lifetime income is available through annuitization or the purchase of an optional lifetime income rider, a benefit for which an annual premium is charged. Annuities are long-term products of the insurance industry designed for retirement income. They contain some limitations, including possible withdrawal charges and a market value adjustment that could affect contract values. Annuities are not FDIC-insured. Not affiliated with the U.S. Federal Government or any government Agency.

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