TSP Modernization Act Reported Out of House Committee

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By on July 20, 2017 in Pay & Benefits with 0 Comments

Hand putting coins in glass jar with retro alarm clock for time to money saving for retirement concept

Legislation recently introduced in the House to allow federal employees to take multiple withdrawals from their Thrift Savings Plan accounts has been reported out of the House Oversight and Government Reform Committee to be considered by the House as a whole.

The TSP Modernization Act of 2017 (H.R. 3031) was introduced by Congressmen Mark Meadows (R-NC) and Elijah Cummings (D-MD) and would allow TSP participants to do the following:

  • Make multiple age-based and post-separation withdrawals
  • Revise the timing and amounts of periodic payments
  • Elect to combine partial withdrawals or an annuity with periodic payments
  • Eliminate automatic annuities as a default option in the absence of an election by participants

Under current law, TSP participants are limited to one withdrawal from their accounts while in federal service upon reaching the age of 59 1/2 (age-based withdrawal), and participants who leave federal service can make only one withdrawal of a portion of the balance in their account (post-separation withdrawal).

For more information, see Legislation Introduced to Allow Multiple Withdrawals from the TSP.

Companion Senate Legislation

A companion bill has also been introduced in the Senate (S. 873) and has also advanced out of Committee.

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Ian Smith is one of the co-founders of FedSmith.com. He enjoys writing about current topics that affect the federal workforce.

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