WebOct 31, 2024 · An outstanding TSP loan must be paid off prior to retirement or it will be considered as a distribution to you. And you will have to pay federal tax and perhaps a penalty to the Internal Revenue ... WebMar 4, 2024 · You’ll typically qualify to borrow from your thrift savings plan as long as you’re a federal employee in pay status and you haven’t recently repaid another TSP loan or taken a taxable distribution from your savings plan. 5. You have two options for borrowing from your TSP. You borrow a General Purpose loan for most of your non-real-estate ...
TSP Loans The Thrift Savings Plan (TSP)
WebJun 8, 2024 · Q: I will be retiring at the end of this year and I have an outstanding TSP loan. What effect will this have on my ability to withdraw funds from my TSP once I retire? A: … WebOct 16, 2024 · Taking a loan from your TSP is a bad idea. The money youre putting into your TSP is for retirement, not for buying a new car. If you leave federal employment with an … butene cracking
Ten Factors to Consider on Federal Retirement - fedweek.com
WebFeb 28, 2024 · If you pull money out of your 401 plan before age 59½, thats generally considered an early or premature withdrawal and subject to both income tax and a 10% early withdrawal penalty. Suppose you take $45,000 from your 401 to pay off debt. For starters, youll face a $4,500 early withdrawal penalty. WebApr 14, 2024 · The money you’re putting into your TSP is for retirement, not for buying a new car. If you leave federal employment with an outstanding TSP loan you have to pay back the full loan balance within 90 days. If you don’t, the IRS will consider the entire outstanding loan amount as a taxable distribution, taxing the sum as earned income. WebSince the new loan plus the outstanding loan cannot be more than $43,322 ($50,000 - $6,678), the maximum amount that the new loan can be is $10,000 ($43,322 - $33,322). See Podcast – computation of maximum loan amount from retirement plans (8:21 mins). A plan may require the spouse of a married participant to consent to a plan loan. cd bap