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By: FEDweek StaffThe House has passed, on a bipartisan vote, a bill (HR-2954) to several retirement savings policies that would affect the TSP along with similar programs. Among numerous other features, the bill would:
* Increase the age at which “required minimum distributions” must begin from the current 72 to 73, then increase it to 74 starting in 2028 and to 75 starting in 2032.
* Increase the “catch-up contribution” limit to $10,000 for those who are age 62-64. Those are additional investments, of up to $6,500 this year, allowed for investors age 50 or above in a calendar year above the standard limit for investing in such plans ($20,500 this year).
* Make more generous the mechanism for increasing both the standard investment limit and the catch-up limit to account for inflation.
* Allow employees to receive matching contributions to their retirement plans for the value of payments they make on student loans instead of making investments into their accounts.
* Permit penalty-free withdrawals of the greater of $10,000 or half of the value of the account for victims of domestic abuse.
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