A Senate committee has joined its House counterpart in backing widened TSP withdrawal options, boosting prospects for enactment of a bill aimed at a long-standing criticism of the program, that investors have too few withdrawal options both while working and after separation.
The Senate Homeland Security and Governmental Affairs Committee passed S-873, the counterpart to HR-3031, cleared earlier by the House Oversight and Government Reform Committee. The bill would allow current employees to make more than one “age-based” withdrawal after turning age 59 ½. It also would allow those retired or otherwise separated to make multiple partial withdrawals and allow more choice in taking “substantially equal” regular withdrawals, including stopping them and taking out the balance of the account as a lump-sum or using it to purchase an annuity.
The TSP asked Congress for those changes after concluding that the relative lack of withdrawal options was a major reason that many investors transfer their money to IRAs or other retirement savings plans after separation rather than keeping their TSP accounts open.
The Senate committee also approved a House-passed bill, HR-1293, to require more reporting on official time, working hours that can be spent on certain union duties. OPM has issued such reports periodically but the bill would require annual reports with additional details including accountings of time spent representing employees who are not dues-paying members, the number of employees who are on official time status full-time, and the value of office space agencies provide without charge to unions.