Can I make 1-time partial TSP withdrawal (pre-retirement) and roll funds into other IRA?


Currently age 62; approx. 5 years from retiring. Can I make a one-time partial withdrawal from TSP balance to roll funds into another qualified IRA (to expand investment opportunities)? Entire balance is vested; most was rolled into TSP upon govt hire. Less than 1% of balance is Roth deposits.

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Posted by (Questions: 1, Answers: 0)
Asked on September 26, 2017 7:23 pm
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Yes you can. Because you are over age 59 1/2, you can take a one-time age-based withdrawal from the TSP. An age-based withdrawal is considered an eligible rollover distribution for federal income tax purposes.
You would use form TSP-75, which can be found on the TSP website. You indicate how much you want to withdraw in section II and then indicate that you want to transfer the withdrawal in Section III. The custodian of the IRA to which you are rolling the money will then fill in the transfer sections of the form; there are sections for both your Traditional and Roth balances.
All withdrawals from the TSP must be proportional, so even though your Roth balance is quite small, you will have to roll some of it into a Roth IRA.
If you are married you will need your spouse’s signed and notarized consent; your signature will also have to be notarized.

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Posted by (Questions: 0, Answers: 64)
Answered on September 26, 2017 9:09 pm