How to Maximize Your 2026 TSP Contributions and Not Lose Agency Matching Contributions

In accordance with Internal Revenue Code (IRC) Section 402, the IRS announces the limit (the “elective deferral” limit) on the amount employees can contribute annually via payroll deduction to their employer-sponsored defined contribution (DC) plans. DC plans include 401(k), 403(b) and 457 qualified retirement plans, and the traditional and Roth Thrift Savings Plan (TSP).

The IRS also announces the limit on the amounts that employees aged 50 and older can make in “catch-up” contributions (also made via payroll deduction) to their DC retirement plans. “Catch-up” employee contributions made to DC retirement plans are in addition to their regular contributions limited by the elective deferral limit. Starting in calendar year 2025, “catch-up” contributions are broken up into two types: (1) the regular “catch-up” contribution limit that applies to employees aged 50 to 59 and to employees over age 63 during the calendar year; and (2) the “super catch-up” contribution limit that applies to employees age 60, 61, 62 or 63 during the calendar year.

This column discusses how elective deferral and catch-up contribution limits affect employee agency matching contributions made to the TSP accounts of employees covered by the Federal Employees Retirement System (FERS). It also explains how a FERS employee could lose some or all of their agency TSP matching contributions — namely, if the employee were to accelerate the elective deferral and catch-up contributions too early during the calendar (not the leave) year. It should be noted that when the TSP changed the rules on TSP catch-up contributions (effective January 1, 2021), the recommended procedure for FERS employees aged 50 and older to maximize their agency matching contributions was simplified.

FERS Employee Elective Deferrals and Their Effect on Agency Matching Contributions

An elective deferral is the dollar amount that an employee asks their employer to deduct from their salary to be deposited to an employer-sponsored DC retirement plan. All before-tax contributions that a federal employee makes to the traditional TSP, and all after-tax contributions made to the Roth TSP, constitute elective deferrals and catch-up contributions. Employees younger than age 50 during the calendar year are limited in the total of their separate contributions to the traditional TSP and to the Roth TSP by the IRS elective deferral limit for that calendar year. Employees aged 50 and over during the calendar year are limited by the total of the annual elective deferral and catch-up contribution limits.

FERS-covered employees are reminded that the elective deferral limit and catch-up contribution limit refer to the calendar year and not to the leave year; currently, that means 2026. Employees are also reminded that at most federal agencies the 2026 leave year ends on January 9, 2027 (there are 26 pay periods during leave year 2026).

For the full 2026 Thrift Savings Plan contribution limit breakdown by age group — including the SECURE Act 2.0 rule requiring higher-income catch-up contributions to go to the Roth TSP — see 2026 Thrift Savings Plan (TSP) Maximum Contribution Limits. In short: contribute at least 5 percent of basic pay to the traditional TSP and/or Roth TSP every pay period. Falling short in even one pay period means that period’s agency matching contribution is lost permanently, not made up later.

When a FERS-covered employee younger than age 50 during 2026 reaches the elective deferral limit, or a FERS-covered employee older than age 50 during 2026 reaches the combined elective deferral and catch-up (or super catch-up) contribution limit, the employee is prohibited from contributing to their TSP account — traditional, Roth, or a combination of both — for the remainder of calendar year 2026. The TSP system will not allow employees to make any excess contributions beyond these limits during calendar year 2026.

Those FERS-covered employees who reach their contribution limit sometime during calendar year 2026 will also have their agency matching contributions suspended for the remainder of the year. This is because agency TSP matching contributions are based on the amount of employee contributions made each pay date. For a FERS-covered employee to receive the maximum agency TSP matching contribution of 4 percent in any calendar year, the employee must contribute at least 5 percent of their salary to the traditional TSP and/or to the Roth TSP each pay date. If there are no employee TSP contributions on a particular pay date, there will be no agency TSP matching contributions — the only TSP contribution will be the agency automatic 1 percent of the employee’s current-year SF 50 salary, since that automatic contribution does not depend on the employee’s own TSP contributions. FERS-covered employees certainly do not want to miss any agency matching contributions. The next section explains how a FERS-covered employee can contribute for the remainder of 2026 and avoid losing any agency TSP matching contributions.

How FERS-covered Employees Can Receive Maximum Agency Matching Contributions

To receive the maximum agency TSP contribution, a FERS-covered employee must contribute at least 5 percent of their basic pay to the traditional TSP and/or to the Roth TSP each pay date during the calendar year. This contribution strategy also applies to Uniformed Service members enrolled in the Blended Retirement System (BRS). FERS employees and Uniformed Service members enrolled in the BRS should use:

(1) Worksheet 1 (for FERS employees and Uniformed Service members younger than age 50 during 2026);
(2) Worksheet 2 (for employees and Uniformed Service members who are age 50 to 59 or over age 63 during 2026); or
(3) Worksheet 3 (for FERS employees and Uniformed Service members who are 60, 61, 62 or 63 during 2026).

Each worksheet allows a FERS employee or Uniformed Service member to determine a dollar amount they should contribute for the remainder of 2026 that will maximize agency TSP matching contributions for calendar year 2026.

To download the checklist and worksheets, click here (opens in new tab).

Worksheet 1: FERS Employees and Uniformed Service Members Younger Than Age 50 During 2026

*FERS-covered employees and Uniformed Service members should check with their payroll processing offices to confirm the number of pay dates remaining in 2026.

Worksheet 2: FERS Employees and Uniformed Service Members Age 50 to 59 or Over Age 63 During 2026

*FERS-covered employees and Uniformed Service members should check with their payroll processing offices to confirm the number of pay dates remaining in 2026.

Worksheet 3: FERS Employees and Uniformed Service Members Age 60, 61, 62 or Age 63 During 2026

*FERS employees and Uniformed Service members should check with their payroll processing offices to confirm the number of pay dates remaining in 2026.

How the TSP Applies the Contribution Limits for a Federal Employee Who Contributes to Both a Civilian and a Uniformed Services TSP Account

The 2026 contribution limits apply to the total contributions a federal employee makes to a civilian and to a uniformed services TSP account during 2026. For example: a FERS employee who contributes to the civilian TSP and is also a member of the Ready Reserve. The TSP applies the appropriate limit to each account separately and does not allow the FERS employee and Uniformed Service member to contribute, in total across both accounts, more than that limit.

The only exception is that tax-exempt contributions made to the traditional TSP of a Uniformed Services member’s account while deployed in a designated combat zone do not count toward the limits above. Any Roth TSP contribution made by a Uniformed Service member while deployed to a designated combat zone does count toward the limits.