TSP Catch-Up Bill Signed into Law

President Bush has signed into law legislation (PL 107-304) allowing TSP participants age 50 and older make “catch-up” contributions–on top of the regular TSP investments allowed–to the retirement savings program of an additional $2,000 in 2003, with the allowable amount rising by $1,000 a year until reaching $5,000 a year in 2006 and adjusted for inflation afterward. The contributions, which will have to be made through payroll withholding, are expected to be available starting with the TSP open season that begins April 15, if not sooner-the timing will depend on what agency payroll systems can handle. Bush’s signature caps an effort to put federal employee investors on equal footing with participants of similar private sector plans, which were given authority under a 2001 tax law to allow such contributions effective this year.