Thread: Can I Contribute My Mil Ret Pay to TSP?

Originally Posted by Moocher

I'm retiring from the Air Force in 2 mths and would like to continue adding to my TSP. Can I continue adding to my TSP with my Mil retired pay? I have a feeling the answer is negative. Please correct me if I'm wrong.

You're correct, once you retire you can't deposit those earnings, sorry. You could roll it over into a 401K, but once you do that, you can't return that money back into the TSP.

He can apply for another government job and even collect the infamous 5%. Nothing wrong with being a double dipper and continuing to be productive.

Now for one more question please. Once I retire from the military I'm going to work for a contractor that has a 401K. Can I take the funds that I accumulate from that 401K and roll it over to my TSP on a monthly basis? From my understanding, the management fees are lower in the TSP compared to a 401K. Thanks for your feedback...

Originally Posted by Moocher

Now for one more question please. Once I retire from the military I'm going to work for a contractor that has a 401K. Can I take the funds that I accumulate from that 401K and roll it over to my TSP on a monthly basis? From my understanding, the management fees are lower in the TSP compared to a 401K. Thanks for your feedback...

I would say it depends on what 401k you are invested in and how much control you have on your money. If you can move between different types of investment then you may make more money in the 401k than TSP. Also, consider diversification. Can you stay diversified and make money??-Keep them seperate. But I would say yes, moving money from qualified programs is legal. Monthly? Too much money in transit and paperwork involved, but then again, it could be worth it!

Originally Posted by Moocher

Now for one more question please. Once I retire from the military I'm going to work for a contractor that has a 401K. Can I take the funds that I accumulate from that 401K and roll it over to my TSP on a monthly basis? From my understanding, the management fees are lower in the TSP compared to a 401K. Thanks for your feedback...

no. once you retire from the government you can't put more money into your TSP unless you return to government employment. You can't rollover another 401k or IRA into it. Everyone, if I've misread the rules, please let me know.

Originally Posted by luv2read

no. once you retire from the government you can't put more money into your TSP unless you return to government employment. You can't rollover another 401k or IRA into it. Everyone, if I've misread the rules, please let me know.

Luv2read and everyone reading,

You can NOT contribute ANYTHING from ANYWHERE to the TSP unless you are currently working for the U.S. Government when the contribution is made.

NO delayed contributions, NO rollovers of anykind. Hardfast rules with NO exceptions.

Awesome info! Thanks all.

Originally Posted by BlueMax

Luv2read and everyone reading,

You can NOT contribute ANYTHING from ANYWHERE to the TSP unless you are currently working for the U.S. Government when the contribution is made.

NO delayed contributions, NO rollovers of anykind. Hardfast rules with NO exceptions.

http://tsp.gov/uniserv/features/chapter02a.html

Can I transfer or roll over money from an existing retirement plan to the TSP?
Yes. Whether you are an active or a separated member of the uniformed services, you can transfer or roll over money from a traditional IRA or eligible employer plan into your existing TSP account. If you are separated from service, you can transfer money into your TSP account unless you have already made a full withdrawal of your account or are receiving monthly payments.
The TSP can only accept funds that are distributed from a traditional IRA or an eligible employer plan (or its designated financial institution). Also, the money that you are transferring or rolling over must be considered an "eligible distribution" under the Internal Revenue Code. If you are considering a transfer or a rollover, you should check with the administrator of the plan from which you wish to transfer the money (or your tax advisor) to ensure that the funds are eligible for transfer (or rollover).
Note: The TSP can only accept transfers or rollovers that consist of before-tax money. The money will be subject to income tax when it is eventually paid to you from your TSP account.

Originally Posted by Frixxxx

http://tsp.gov/uniserv/features/chapter02a.html

Can I transfer or roll over money from an existing retirement plan to the TSP?
Yes. Whether you are an active or a separated member of the uniformed services, you can transfer or roll over money from a traditional IRA or eligible employer plan into your existing TSP account. If you are separated from service, you can transfer money into your TSP account unless you have already made a full withdrawal of your account or are receiving monthly payments.
The TSP can only accept funds that are distributed from a traditional IRA or an eligible employer plan (or its designated financial institution). Also, the money that you are transferring or rolling over must be considered an "eligible distribution" under the Internal Revenue Code. If you are considering a transfer or a rollover, you should check with the administrator of the plan from which you wish to transfer the money (or your tax advisor) to ensure that the funds are eligible for transfer (or rollover).
Note: The TSP can only accept transfers or rollovers that consist of before-tax money. The money will be subject to income tax when it is eventually paid to you from your TSP account.

OK. I thought the rules might be different for the military, but I just checked and they aren't. Which means that the rules are changed. When my parents retired, you could NOT make deposits of ANY sort into TSP. Here's the rules for civilians from TSP.GOV:

Can I transfer or roll over money from an existing retirement plan to the TSP?
Yes. Whether you are an active or separated Federal employee you can transfer or roll over money from a traditional IRA or an eligible employer plan into your existing TSP account. If you are separated from service, you can transfer money into your TSP account unless you have already made a full withdrawal of your account or are receiving monthly payments.
The TSP can accept funds that were distributed from a traditional IRA or an eligible employer plan (or its designated financial institution). The money that you are transferring or rolling over must be considered an "eligible distribution" under the Internal Revenue Code. If you are considering a transfer, you should check with the administrator of the plan from which you wish to transfer the money (or your tax advisor) to ensure that the funds are eligible for transfer or rollover.
Note: The TSP can only accept transfers that consist of before-tax money. The money will be subject to income tax when it is eventually paid to you from your TSP account.

You are correct the rules changed about seven years ago (July 2001), shortly after the S and I funds started (May 2001). The old rule was that TSP account holders could not transfer/rollover into TSP from their IRA/401. Now you can move money into TSP from qualified plans (i.e. retirement money not previously taxed).

Originally Posted by EW_ret

You are correct the rules changed about seven years ago (July 2001), shortly after the S and I funds started (May 2001). The old rule was that TSP account holders could not transfer/rollover into TSP from their IRA/401. Now you can move money into TSP from qualified plans (i.e. retirement money not previously taxed).

Thanks EW. I knew that new and currently employed feds could do rollovers but was not aware that retirees and otherwise separated feds could also.