Contribution Limits for TSP

A question about TSP contributions that always comes up in my training seminars is what happens to the agency contributions if I reach my annual TSP contributions limit to my Thrift Savings Plan (TSP)?  When you reach your limit before the end of the year, of course, your contributions are suspended for the remainder of the calendar year.  In that regard, it is always important to speak your TSP representative in your human resources office to make sure that your contributions are stretched out over 26 pay periods – you may also wish to work with a financial professional who is knowledgable about federal retirement needs who can help you look at additional options for savings too.

There are stop-alerts, as I call them, that prevent violating the current year TSP annual contributions limit set by the Internal Revenue Code (IRC) for limits on elective deferrals.  In other words, the TSP system will not allow employee contributions to be made into the fund when the limit has been reached.

                             View Your TSP Contribution Limits HERE

Your agency and employee TSP contribtions work in tandem.  As you make contributions to your TSP account so does your agency.  Therefore, when your contributions are suspended so are the agency’s TSP contributions.  The agency’s TSP contributions depend on the amount of contributions you are making during each pay period.

However, the agency’s one percent automatic TSP contribution continues even though your agency matching contributions and your contributions have stopped.  All such contributions are limited to those employees classified under the Federal Employees Retirement System (FERS).

P. S.  Always Remember to Share What You Know.