Annual Leave and Your Thrift Savings Plan

By on April 15, 2010 in Current Events with 0 Comments

There is potential good news on the horizon for federal employees who plan to retire with a large annual leave balance. The news relates to the ability to contribute their annual leave balance to the Thrift Savings Plan.
 
Currently, federal employees, unlike their private sector counterparts, cannot contribute the cash value of their A/L to the TSP. If HR 4865 is passed and signed into law, federal employees will be able to take that A/L balance and contribute it to the TSP, as long as their annual contributions do not exceed the annual elective deferral limit. That limit is $16,500 for 2010.
 
The bill is sponsored by Representatives Stephen Lynch (D-MA) and Jason Chaffetz (R-UT). In addition to the fact that the sponsors are from different parties (how unusual), President Obama indicated a few months ago that he would sign such legislation if it crosses his desk.
 
HR 4865 is called The Federal Employees and Uniformed Services Retirement Equity Act of 2010. If the spirit moves you, contact your representative and ask him or her to support the bill.

John Grobe’s latest book, The Answer Book on Your Federal Employee Benefits, has just been released by LRP Publications. The book is written in an easy to understand question and answer format and covers all areas of federal benefits from the perspective of an employee at various stages of their career. Order your copy at shoplrp.com.

© 2016 John Grobe. All rights reserved. This article may not be reproduced without express written consent from John Grobe.

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About the Author

John Grobe is President of Federal Career Experts, a consulting firm that specializes in federal retirement and career transition issues. He is also affiliated with TSP Safety Net. John retired from federal service after 25 years of progressively more responsible human resources positions. He is the author of Understanding the Federal Retirement Systems and Career Transition: A Guide for Federal Employees, both published by the Federal Management Institute. Federal Career Experts provides pre-retirement seminars for a wide variety of federal agencies.

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