Thrift Savings Plan (TSP) Withdrawal Options After Leaving Federal Service

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What do I need to know before making a withdrawal from my TSP account?

You are eligible to withdraw your account when you separate from federal service.  You can also leave all or a portion of your account in the TSP and withdraw it later.  However, there are limits on how long you can leave your money in the TSP. 

When you leave federal service, your agency should give you information about your TSP withdrawal options. 

Because the tax rules that apply to each of the withdrawal options are complex and may differ depending on the option(s) you choose, you should also read the tax notice "Important Tax Information About Payments From Your TSP Account." 

Thrfit Savings Plan withdrawal options

The TSP provides several ways to withdraw your account:

  • You can make a partial withdrawal of your account in a single payment.
  • You can make a full withdrawal of your account using any one, or any combination, of the following methods:
    • A single payment
    • A series of monthly payments
    • A life annuity

A combination of any of the above three full withdrawal options is called a "mixed withdrawal."

You can have the TSP transfer all or part of any single payment or, in some cases, a series of monthly payments, to a traditional IRA or eligible employer plan.  If you submit a paper form to make your withdrawal request, payments to you can be deposited directly into your checking or savings account by means of electronic funds transfer (EFT).

Note:  If you are a FERS employee and you have not met the TSP vesting requirements when you leave federal service, you are not entitled to the agency automatic (1%) contributions in your TSP account (or their earnings).  This money will be forfeited to the TSP.