TSP catch up - about four pay periods left in 2015

[offroad]

So am trying to play catch up with my TSP contributions for the remainder of the year. Know what the maximums are for TSP regular, and TSP catch up.

But did not know, that when you get into the MYPAY system for federal employees, and make a change, its effectively LOCKED until your next pay period. You can not elect to cancel contributions, the next day. Wow what a way to find out if you make a mistake. Lucky for me I have the means to handle the income change for one paycheck.

Also am questioning what is the maximum contribution for the ROTH TSP per year, and have not found that spelled out any where yet.

[Cactus]

The contribution limit for your TSP + ROTH TSP + any other 401K plan you may be contributing to is $18,000 total for the year. The catch up is $6000 for those 50 and over. So the most you can contribute is $24,000. That is total, not per account. If you have more than that to sock away (lucky you) you can contribute up to $5500 to an IRA/ROTH IRA with a catch up of $1000.

[offroad]

Cactus - so independent of the TSP amounts, I can still create a separate $6500 more to a IRA? That would be awesome. Considering that taxes for state and federal can be in the 20% plus cost amount, you get an instant return on that contributed money on your taxes of that 20%.

So 20% of $6500 is a $1300 savings on taxes that year. Wow, and what a nice payback for shifting money from your emergency account to your IRA.

Assuming you have that much extra in your emergency account.

[ipcellon]

I was researching this exact question yesterday and I am pretty sure that the max for 2015 to contribute into TSP (for someone under 50 years of age) is $18000.00 One can put up to $5500.00 in the Roth TSP. Then you need to subtract that $5500 from the total of $18,000 for the regular TSP investment which equals $12,500.

There is a way to go above the $18,000 limit which is to open a separate non-TSP roth IRA and contribute the max at $5500.00 for a total yearly savings of $23,500.00.

One cannot though put $5500.00 into the Roth TSP and $18,000 into the "normal" TSP.

Be careful with your math because if you top the $18000 threshold then you will not receive your matching contributions from your agency.

Best to double check what I wrote but I am pretty positive I am correct.

https://www.tsp.gov/PDF/formspubs/oc91-13.pdf

Ipc

[Skorcher]

ipcellon is right on. However you state that your Roth IRA is independent of your TSP. Subject to Adjusted Gross Income limitations you can put up to $5500 (or $6500 if over 50) into a Roth IRA even if you are maxing out on your TSP contribution. Roth IRA contributions do not save you anything on taxes in the year of contribution. The tax savings come when you start withdrawals which are 100% tax free.

[Cactus]

OffRoad, yes you can contribute the max contribution to both your 401K (TSP in our case) and your IRA. They are separate saving vehicles and have different AGI cutoff limitations.

Be careful about moving existing money from an emergency account into an IRA. You have to have earned income of the amount you are putting into your 401K + IRA for the year. You can't earn nothing and just pay for it with savings.

If you are a real high earner and want to save even more, you can also open and fund a spousal IRA for your wife whether she has earned income or not. She would have to open up her own account for this. The IRA limits are the same as yours only now it really is her money. That's why they call it an Individual Retirement Account.

[Shamus13]

I was researching this exact question yesterday and I am pretty sure that the max for 2015 to contribute into TSP (for someone under 50 years of age) is $18000.00 One can put up to $5500.00 in the Roth TSP. Then you need to subtract that $5500 from the total of $18,000 for the regular TSP investment which equals $12,500.

There is a way to go above the $18,000 limit which is to open a separate non-TSP roth IRA and contribute the max at $5500.00 for a total yearly savings of $23,500.00.

One cannot though put $5500.00 into the Roth TSP and $18,000 into the "normal" TSP.

Be careful with your math because if you top the $18000 threshold then you will not receive your matching contributions from your agency.

Best to double check what I wrote but I am pretty positive I am correct.

https://www.tsp.gov/PDF/formspubs/oc91-13.pdf

Ipc

I'm confused, You say max contributions to your ROTH TSP is $5,500? Because I have been contributing 100% to my ROTH TSP for 2 years and am maxing out at $18,000. I'm young so catch up contributions aren't a factor for me & that might restrict the amount. Can you please explain you example a little more please.

[PessOptimist]

I believe the limit on a Roth TSP is the same as regular TSP or $18k this year and next year. One of the advantages of Roth TSP over a Roth IRA. I don’t know personally as I don’t contribute to Roth TSP. I understand catch up contributions can also be allocated to a Roth TSP. I know you and spouse can contribute an additional $5.5k to a Roth IRA.

https://www.tsp.gov/PDF/formspubs/high12a.pdf sorta says that on the second page.

If you end up having both types of TSP accounts make sure you understand the withdrawal rules.

PO

[offroad]

I think I get it now.

$18000 is the normal limit grand total combined for all TSP if under age 50.

$6000 is the extra you can contribute if over age 50.

Has to be earned income you put in. So you could put 100% of your paycheck into TSP in the last couple months of the year (minus your health insurance and SS amounts , etc.). As long as you can live off someone else paycheck, or live off your savings.

yes the difference in tax savings depend on if it goes to Roth or not to Roth. Depends on your retirement income. if you are going to be high income in retirement use roth. But since all us normal people are going to be making less in retirement, then getting taxed less is fine.

[jkenjohnson]

The contribution limit for your TSP + ROTH TSP + any other 401K plan you may be contributing to is $18,000 total for the year. The catch up is $6000 for those 50 and over. So the most you can contribute is $24,000. That is total, not per account. If you have more than that to sock away (lucky you) you can contribute up to $5500 to an IRA/ROTH IRA with a catch up of $1000.

Yeah and if you save too much you have to pay the IRS a penalty. Happened to me a couple of years ago.

[nasa1974]

Here is some more information from Govexec.com
Government News, Research and Events for Federal Employees - GovExec.com (http://www.govexec.com/)

TSP Contribution Caps, Locality Pay, No Budget Pain For Feds, And More
By Kellie Lunney October 28, 2015

TSP Contribution Caps, Locality Pay, No Budget Pain For Feds, And More - Pay & Benefits Watch - Pay & Benefits - GovExec.com (http://www.govexec.com/pay-benefits/pay-benefits-watch/2015/10/tsp-contribution-caps-locality-pay-no-budget-pain-feds-and-more/123210/?oref=river)

[Valkyrie]

do the 5% matching and that's it. put the other 10% and any matching into private accounts.
u will thank me one day.

[offroad]

well I had changed my allocations using the MYPAY system, and it did not take. the next paycheck had my original allocations as set six months ago. So it looks like even if you try to change the allocations you still need to talk to payroll to see that they have rippled down to them.

[Maricar19]

Is the catch up contibution TSP traditional also taken off your taxable earnings? Tax deferred like regular tsp contributions?

[maui21ice]

do the 5% matching and that's it. put the other 10% and any matching into private accounts.
u will thank me one day.

Great advice I was given right there when I started my federal job. That's what I'm doing as well instead of bumping up TSP, I'm adding to my external Roth IRA through my bank. Once I pay off college I'll have the extra $450 a month to put toward the monthly Roth contribution.

[PessOptimist]

Is the catch up contibution TSP traditional also taken off your taxable earnings? Tax deferred like regular tsp contributions?
Yes

PO