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Tsp 70 Fillable 2006 Form

learning how to use the TSP withdrawal forms so I'm not going to bore you and go through every column of these forms because it's quite voluminous but let's start here with the TSP 75 this one is titled the age-based in service withdrawal requests so let's break down those words real quick what is age based age base means you are 59 and a half or older 59 and a half or older and you're still in service so we're gonna look at some other forms after you retire but right now we're just talking about still employed in service means still employed so you're 59 and a half you're still employed and you want to make this withdrawal request this is the form that you would use and it's it's got some complications so let's walk through it I'm gonna take you to the biggest concern that you have you'll look on the screen here I'm going to put up box two which is a withdrawal request form this is the amount you are requesting so if you'll notice with this then while you're still employed you can request any amount from the TSP simply because you've reached that magic age of 59 and a half now why half I don't know I guess half the politicians wanted 59 the other half one at sixty so they compromise to 59 and a half I don't that's what it is what it is but when you reach that age you can put whatever amount you want on this line and you can withdraw it now if you'll notice the very next box down it says transfer election here you can elect to transfer that withdrawal directly to an IRA or if you have a Roth TSP you can also do it to a Roth IRA if you would like and so you can check that box and then you'll take note that a couple of pages later there is on box nine the where you can put in line twenty twenty nine you can tell them how much or what percentage of the amount you were requesting that you want to transfer to your IRA so let me help you out you're 60 years old and you are ready to buy that boat before you're ready to retire let's just play that game for a minute and you need twenty thousand dollars to buy that boat you can move your TSP out decide what percentage of your TSP withdrawal needs to be put in your pocket again now they're gonna withhold 20% mandatory federal withholding so gross it up by 20% or get 20% less of a boat one of the other but there'll be tax if you've got tax deferred money that you're pulling they will send you whatever percentage you want and allow you to roll the rest of it to an IRA if you want so you can have that dual function by going through these two parts of the form okay so make sure your percentage is match they said in dollars now this is percentages when you get down to section nine you have to think through the math on that make sure make sure it makes sense for you and you're calculating the 20% mandatory federal withholding they're going to have as well so that's the way you can make a partial withdrawal once you've done this one time once you've used this TSP seventy five it is no longer any good or available to you for a second use so if you do this because you want to get your hands on a little bit of the money for some great purpose you won't be able to do that again so if you think you may need more money before you retire you might want to move a portion of that money to an IRA or a Roth IRA to have more accessibility we're understanding the world's withdrawal options the pros and cons within the TSP so that's why you're employed if you want to move the money's out next let's talk about a full withdrawal so you'll see on the screen now that we have the TSP seventy the TSP seventy is clearly titled request for full withdrawal there is one other form that we're not going to cover today the TSP seventy seven it's very similar this it's the TSP partial withdrawal if you don't use your in service withdrawal before you retire then you can use one partial withdrawal and then you have to go to the full withdrawal option so let's examine this form and the TSP seventy seven that partial withdrawal you can look that up if that applies to you as well so you've fully retired and you want to do something with your TSP this is your main form that you would consider using let's look at the boxes here on the screen section four it is called you will see that you have multiple options on this form the first option says I'd like to withdraw my tire balance as follows you can get a a single payment watch out that's a big tax day if you make that election you can get a life annuity or you can choose TSP monthly payments and if you'll notice in this section box 23 a B and C those are all percentages as well so you can take again not a specific dollar amount but a percentage of the money and take possession of it watch out 20% mandatory tax yes that happens there you can turn a percentage of it into a guaranteed income stream where basically I think it's MetLife that manages that contract you can pick from about 17 different options how long you might live your spouse might live pros and cons of that are pretty dramatic but you can choose a life annuity here when you get your TSP statement you see the single life annuity number that you could turn your lump sum into X number of dollars every month when you get that on your statement that's this is where you would elect that right here on this life annuity selection so be careful of that make sure you understand if you put your money into a life annuity you are giving up control of that lump sum forever in exchange for a guaranteed income as long as you and or your spouse live make sure that's what you need it seems oftentimes that federal employees already have guaranteed income this form of the federal pension Social Security and the TSP tends to be something that can be used for occasional withdrawal needs as opposed to a guaranteed income flow but that's an option that you have with it within the TSP and lastly you can just request TSP monthly payments now when you choose the monthly payment option that is the number and you must keep it that way until the turn of the year once a year they'll open up a window the last part of a year so that in January your new amount can you can update what you withdraw and get that new amount so let's say you're drawing $1,000 now in June you decide you need $2,000 a month you can't make that adjustment until the end of the year going forward for the following year so you have to think ahead good when you're do the monthly distribution option and there's still taxes to be withheld out of that the 20% federal mandatory and you can have some other taxes taken out if that's not enough also when you make this election remember that coffee and cream example every dollar that comes out of the TSP is going to come partially from the traditional partially from the Roth if that's what you what you have done if you've built it with both buckets it's going to be distributed from the TSP that way as well now let's look a little deeper into the form and we'll see if you look at line what's called 45 back in the in the document and you have your transfer election balance that's available for your single payment or your monthly payment again so we have this same level of complexity in which you first say yes I want to move it and then you say what percentage of it you want to move to an IRA or Roth IRA and what percentage of it you want to put in your pocket so you've got a two-step process as you walk through these forms and then one more layer of complexity if you have the Roth this specifically is the transfer form you have to complete for the Roth where does it need to go your custodian again if you're moving it directly to a Roth IRA you need to make sure the custodian is listed and if you do not complete this form this part of the package and you have a Roth TSP balance the the federal government the TSP will send your traditional TSP to wherever you told them to send it and they'll send you a check for your Roth amount so be careful this form is critical you've got to have it as part of the package if you have some raw founts and tell them what to do with it or else is showing up in the mail so if it shows up in the mail seek tax advice because that's not it's probably not what you intended and it messes up the tax planning you were probably doing there are some fixes to that but you need to make sure you ask and get some good support on that you