Thrift Savings Plan catch-up contributions are additional employee contributions that federal employees age 50 or older (or turning age 50 during the calendar year) can make to the TSP beyond the maximum amount they can contribute through regular contributions. Employees may choose to make TSP catch-up contributions on a traditional (pre-tax) basis or a Roth (after-tax) basis.
Employees are eligible to make TSP catch-up contributions if they are:
- age 50 or older during the calendar year in which the catch-up contributions are made (including if the employee becomes age 50 on December 31 of that year);
- currently employed and in pay status; and
- making regular contributions to a civilian or uniformed services TSP account (or both), and/or an equivalent employer plan (such as a 401(k), 403(b), or 408(k)(6) plan) that will equal the maximum allowed by the Internal Revenue Code (IRC). The maximum allowed is subject to change every year.
If a federal employee is within 6 months of making a financial hardship withdrawal from the TSP, they are not eligible to make catch-up contributions.
What is the maximium TSP catch-up contribution?
Eligible federal employee can make catch-up contributions up to the annual maximum dollar amount allowed by the IRC. Maximum TSP catch-up contribution limits are subject to annual increases for inflation.
Catch-up contributions apply to the year during which you made them, even if they are posted to your account in the following year (i.e., your contributions for the last pay date in December may not be posted until January, but will be counted toward the limit in December).
Other things to know about TSP catch-up contributions
- There are no agency matching contributions on catch-up contributions.
- Catch-up contributions can only be made from basic pay. Bonuses (or, if you are a member of the uniformed services, special pay or incentive pay) cannot be applied toward catch-up contributions.
- Catch-up contributions are made only through payroll deductions by submitting Form TSP-1-C to the employee’s agency.
It’s never too late to start
Federal employees can elect to make TSP catch-up contributions at any time. The election becomes effective the first full pay period after the employee’s agency receives it, and will only be valid through the end of the calendar year in which it is made. Employees must submit a new Catch-Up Contribution Election form each year. Contributions will continue until the end of the calendar year unless the employee reaches the annual catch-up contribution limit before that time or elect to stop making catch-up contributions.
Employees can change or stop making catch-up contributions by submitting another Form TSP-l-C to their agency. Once employees stop catch-up contributions, they will not resume automatically. However, employees can restart contributions at any time by completing another TSP-1-C form.
Once catch-up contributions are posted to an employee’s TSP account, they become part of the account balance and are subject to the same rules as any other employee contributions, including:
- The employee is immediately vested in them
- They are available for withdrawals and loans
- Spouses’ rights apply
- An interfund transfer has the same effect on them as on the rest of the money in the account