The Thrift Savings Plan announced this week that it is making a temporary change to financial withdrawal rules to assist victims of Hurricane Matthew.
Beginning yesterday, October 25, the TSP will treat any Financial Hardship In-Service Withdrawal Request (Form TSP-76) received until March 8, 2017 as qualifying for a hardship withdrawal if the participant writes “Hurricane Matthew” at the top of the form and checks the block on the form for personal casualty on page 2, Item 18 of the form. The distributions must occur before March 15, 2017 to qualify for this treatment.
The participant should write “Hurricane Matthew” at the top of the form and check the “personal casualty” box on the TSP-76. The TSP will then waive the rule that prohibits a participant from making employee contributions for 6 months after taking a hardship withdrawal. This will allow an employee to continue to make contributions to the TSP and receive the employer match (if eligible). This temporary change will not be effective retroactively.
According to an announcement on the TSP’s website, the TSP will treat any Financial Hardship In-Service Withdrawal Request as a qualifying hardship and will waive the rule prohibiting employee contributions for 6 months after taking a hardship withdrawal provided one of the following is true:
The individual’s primary residence or place of employment is located in a covered disaster area and has incurred a loss as a result of Hurricane Matthew.
OR
The hardship withdrawal will be used to assist an eligible family member who lives or works in a covered disaster area and who has incurred a loss as a result of Hurricane Matthew.
Additionally, individuals must also meet all of the following requirements:
- You must be actively employed as a federal civilian or a member of the uniformed services.
- You must complete Form TSP-76,PDF document Financial Hardship In-Service Withdrawal Request.
- You must write “Hurricane Matthew” at the top of page 1 above the name of the form.
- You must check the “Personal Casualty Loss” box on page 2, Item 18 of your request form, as the reason for requesting financial hardship.
- Your request must be received by TSP offices by March 8, 2017 and, in compliance with IRS guidelines, your distribution must occur before March 15, 2017. Any Financial Hardship In-Service Withdrawal Request forms received after March 15, 2017 will be processed as a standard hardship withdrawal, and your TSP contributions will automatically stop for 6 months.
The TSP also noted that this rule change is not retroactive and all other Form TSP-76 rules apply. Participants may only receive one hardship withdrawal under this change. Individuals who have questions about the change can call the toll-free ThriftLine at 1-877-968-3778 or 404-233-4400 for those outside of the US and Canada (not toll free).
