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Thread: 401K catch up transfer into my TSP? possible or no?

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    Default 401K catch up transfer into my TSP? possible or no?

    I have a 401k fund, but am not getting much gains on it at all. Is it possible to transfer money into a TSP account, up to the catch up limit, without incurring any penalties? Can I do that from an outside account?


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  3. #2

    Default Re: 401K catch up transfer into my TSP? possible or no?


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  5. #3

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    Default Re: 401K catch up transfer into my TSP? possible or no?

    Quote Originally Posted by offroad View Post
    I have a 401k fund, but am not getting much gains on it at all. Is it possible to transfer money into a TSP account, up to the catch up limit, without incurring any penalties? Can I do that from an outside account?
    There is no $ limit for rollovers (it is not counted against your catchup OR regular contributions for the year) , but I believe you can only do one per year. And I highly recommend the direct rollover, not the take out then put in another 401K (indirect rollover). It's much cleaner and you don't have to worry about the 60 day limitation.
    There are 10 types of people in the world. Those who know binary, and those that don't!!
    Retired on December 31, 2018!!

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  7. #4

    Default Re: 401K catch up transfer into my TSP? possible or no?

    Quote Originally Posted by offroad View Post
    I have a 401k fund, but am not getting much gains on it at all. Is it possible to transfer money into a TSP account, up to the catch up limit, without incurring any penalties? Can I do that from an outside account?
    It would be better to transfer it to an IRA where you would not be hampered by the TSP's two IFT limits per month. You can replicate the TSP funds with various ETF's except for the G fund.

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  9. #5

    Default Re: 401K catch up transfer into my TSP? possible or no?

    Quote Originally Posted by uscfanhawaii View Post
    but I believe you can only do one per year.
    I had my wife roll her private sector 401's to TSP last year and she had more than one so multiples are allowed.
    TSP: 2007=6.4%, 2008=(39.95%), 2009=30.96%, 2010=17.04% , 2011=(4.92%), 2012=17.74%, 2013=26.58%, 2014=5.39%
    TSP Talk: 2015=???

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  11. #6

    Default 401K catch up transfer into my TSP? possible or no?

    Skorcher - I want to do what you mention. But there is little guidance for managing 401k money on ETF accounts. How do you make certain you are only buying retirement qualified funds?

    Just reading that I can put my funds into a self guided IRA. And that is how to make it work. But of course need more information.

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  13. #7

    Default Re: 401K catch up transfer into my TSP? possible or no?

    and when I transfer funds into my TSP from my 401k they will become TSP funds correct?

    The reason this is significant as TSP is available as soon as you retire, which is 55 plus years old. While 401k is not available until you retire at 59. Please check this but it seems to be true.

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  15. #8

    Default Re: 401K catch up transfer into my TSP? possible or no?

    Quote Originally Posted by offroad View Post
    Skorcher - I want to do what you mention. But there is little guidance for managing 401k money on ETF accounts. How do you make certain you are only buying retirement qualified funds?

    Just reading that I can put my funds into a self guided IRA. And that is how to make it work. But of course need more information.
    If you want to open a Self Directed IRA, and your funds are currently in a company-sponsored 401(k), then you have to…

    1. Open a new account with a custodian like Vanguard or Fidelity that can handle self-directed IRAs.
    2. Request a rollover form from the plan administrator for your current 401(k).
    3. Fill out the form, give it to the plan administrator, and he/she will transfer the funds to the self-directed custodian.


    • Important note – Many company-sponsored 401(k) plans will not allow rollover of funds if the employee is still working for the company. In these cases, rollover is only allowed when the employee leaves the company.



    If you are planning on withdrawing from your 401k or IRA before age 59.5 then it would be easier to keep it in a 401k.

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  17. #9

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    Default Re: 401K catch up transfer into my TSP? possible or no?

    FYI department about rolling over tax deferred savings. I recently moved a very old IRA from one financial institution to another. The original institution had been paying close to 0.0007% per anum. They insisted I talk to a "financial planner" who promised higher yields etc. etc. I was very specific that I wanted a direct rollover to an account I gave them the information for. After a long wait they came up with a check and a tax form. I signed and took and went to the receiving financial institution and deposited the money in the new IRA. The receiving institution told me it should have been a direct rollover form and I should go back and get one. I declined, deposited the money and said I would deal with any IRS 1099s issued. I have received none so far. Reading rules leads me to believe none will be generated under the 60 day rule. Time will tell.

    Two lessons learned.

    Financial institutions hate to easily give up money they have been using for years for free.

    If you put the money in to another tax deferred account withing 60 days it seems like no hassle.

    I can't answer your question about making an IRA TSP money and withdrawal rules but it seems it should be so, maybe with a time limitation?

    PO


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  19. #10

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    Default Re: 401K catch up transfer into my TSP? possible or no?

    Quote Originally Posted by Itchn2retire View Post
    I had my wife roll her private sector 401's to TSP last year and she had more than one so multiples are allowed.
    The law changed Jan 1, 2015. It's pretty complicated, but I believe Itchn2retire is still correct.
    Here is the link: Two 2014 Court Decisions Affect Federal Employees Treatment of IRAs

    Especially see the part that goes "there are no restrictions on direct IRA transfers, employees with multiple IRAs are encouraged to request direct transfers of any of their IRA accounts. The IRS confirmed that in the case of a direct rollover in which the IRA custodian makes a check payable directly to the receiving custodian rather than to the IRA owner, then this procedure will qualify as a trustee to trustee transfer. It will not be subject to the once-per-year rollover rule. The new IRS rule also does not apply to rollovers from retirement plans such as the TSP to IRAs or from IRAs back to retirement plans. Conversions of traditional IRAs to Roth IRAs are also exempt from the once- per-year rollover rule."

    Be careful out there. And make sure you know the rules for your particular issue before executing. No one will tell you it was wrong until the IRS sends you a letter in the 6th year (just before statute of limitations runs out in 7 yrs) and you not only owe the penalty for the one year, but also for the following 6 yrs...PLUS INTEREST!
    (Not to belittle the efforts of our friends in the IRS....If you have add'l suggestions, please chime in!)

    Hope this helps!
    There are 10 types of people in the world. Those who know binary, and those that don't!!
    Retired on December 31, 2018!!

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