Air Force

December 14, 2012

Thrift savings plan contribution limits increase in 2013

by Kathryn Iapichino
Air Force Personnel Center Benefits and Entitlements counselor

JOINT BASE SAN ANTONIO-RANDOLPH, Texas  —  The Federal Retirement Thrift Investment Board has announced the 2013 elective deferral limit for regular Thrift Savings Plan contributions increased from $17,000 to $17,500 for 2013, Air Force Personnel Center officials said. The TSP catch-up plan contribution limit will remain at $5,500.

The Thrift Savings Plan is a long-term retirement savings plan which allows investors to build an investment portfolio while lowering their taxes each year they contribute. Contributions go directly from each paycheck to the member’s account, which makes it easy to pay yourself first, with taxes deferred until post-retirement withdrawal.

Investments are not limited to stocks, so employees can choose government securities or invest in lifecycle funds as well. Regular TSP contributions stop when an employee’s contributions reach the annual maximum limit and then automatically resume the next calendar year.

Catch-up contributions are additional tax-deferred contributions separate from regular contributions. Catch-up contributions provide investors a way to secure their retirement, especially for those who begin investing later in their careers.

To be eligible for catch-up contributions, civilian and military employees must be at least 50 years old the year the first deduction from pay occurs. They must also be in a pay status and able to certify they will make (or have made) the maximum regular employee contributions by the end of the year.

Contributions to other accounts such as uniformed services TSP accounts, employee tax deferred programs and 401Ks also count toward the elective deferral limit.

Employees who have taken a TSP financial hardship in-service withdrawal are not eligible to invest during the six-month, non-contribution period.

Catch-up contributions automatically stop with the last pay date in the calendar year or when the maximum catch-up dollar limit for the year is reached, whichever comes first. Eligible employees must submit a new election for each year they participate.

TSP for military members

Military members can contribute any whole percentage up to 92 percent of basic pay, as long as the annual total does not exceed $17,500 for 2013. If contributing from basic pay, Airmen may also invest all or part of their bonuses, special pay, or incentive pay.

Members may enroll and adjust contribution amounts through their Defense Finance and Accounting Service myPay account. Thrift Saving Plan elections made in the current month will be reflected on the leave and earnings statement for the next month.

Those serving in tax-free combat zones may contribute up to $51,000 in annual contributions for 2013, which total includes tax-exempt combat zone contributions and regular deferred contributions. However, there are monthly contribution limits. Military members can call TSP officials at 877-968-3778 for more information.

Military members who want to make catch-up contributions must complete and forward the TSP-U-1-C, TSP Catch-Up Contribution Election Form, to their local finance office.

To make contribution allocations (how an employee chooses to invest money among the investment funds) military members can go to www.tsp.gov and use their personal identification number and password to access their
TSP account. Contribution allocations can also be made via the Thrift Line (877-968-3778).

For general TSP questions, call the Total Force Service Center at 800-525-0102 (press 1 and then press 6).

TSP for civilians

Eligible civilians can contribute any whole percentage of their basic pay or a whole dollar amount each pay period to a regular TSP account. This amount is subject to the $17,500 annual maximum for 2013. Generally, employees covered by the Civil Service Retirement System or the Federal Employees’ Retirement System who are in a pay status and working full-time or part-time are eligible to contribute to TSP. For further information on contribution eligibility see the TSP website at www.tsp.gov.

Air Force-serviced civilians may submit regular TSP enrollment elections or changes at any time. Contributions will automatically continue into 2013 for those already in TSP; so, it is not necessary for employees to submit an election unless they wish to change the amount of their bi-weekly contributions. The Jan. 4 contribution will apply toward the 2013 annual maximum.

Employees who are covered by the Federal Employees’ Retirement System must contribute at least 5 percent of their basic pay every pay period in order to receive maximum agency matching contributions throughout the entire year. Once the maximum contribution limit of $17,500 is reached, employee contributions and agency matching contributions will be suspended for the remainder of the year.

Regular TSP enrollments, changes, or catch-up contributions submitted Dec. 2 through 15 will be effective Dec. 16, which will be reflected on the leave and earning statement for the pay period ending Dec. 29.

When submitting catch-up contribution elections, employees must designate a whole-dollar amount to contribute each payday. Do not designate an amount that exceeds net pay or payroll will not withhold any TSP contributions. To spread catch-up contributions evenly over the year, divide the total contribution (up to $5,500) by the number of pay dates remaining in the year.

Air Force-serviced civilians submit contribution elections via the Employee Benefits Information System online application. The benefits system is accessible on the Air Force Portal or through the Air Force Personnel Services secure website.

For more information about TSP, go to www.tsp.gov. Click on “Summary of the Thrift Savings Plan” located under civilian or uniformed services TSP Forms and Publications. For more information about other personnel issues, visit the myPers website at https://mypers.af.mil.




All of this week's top headlines to your email every Friday.


 
 

 
U.S. Army photo/Staff Sgt. Jennifer McLaughlin

Jones assumes command of 304th SBDE

U.S. Army photo/Staff Sgt. Jennifer McLaughlin Col. Robin Jones, incoming 304th Sustainment Brigade commander, accepts the unit colors from Brig. Gen. Scottie Carpenter, 311th Expeditionary Sustainment Command commanding genera...
 
 
Untitled-1

Creating a lifestyle of health and fitness

U.S. Air Force photo/Tech Sgt. Neil Ballecer Senior Airman Coral Williams, 163rd Comptroller Flight, begins a run on the March Air Reserve Base track, April 7. Running is one of the many cardiovascular exercises Williams partic...
 
 

March Volunteer Income Tax Assistance Center closes soon

The March Volunteer Income Tax Assistance Center will remain open for filing taxes until April 30, 2014. With the formal tax season now over, the March VITA Tax Center has prepared approximately 800 returns, saving nearly $100K in preparation fees, and clients have received back more than $850 thousand in combined state and federal refunds,...
 

 

Reveille: Continuing a proud military tradition

Reveille is a French word that literally means “wake up” and is traditionally played at sunrise on military installations. Here at March ARB, the 452nd Security Forces Squadron raises the national flag during reveille at 7:30 a.m. each day. The practice of reveille can be traced back to the French army, which used a form...
 
 

UPCOMING TICKETS AND TOURS EVENTS

Some restrictions apply. Times are approximate. MAY Date: May 1 Event: Price Is Right Cost: $16 per person Depart: 6:30 a.m. Return: 5:30 p.m. Description / Restrictions: Come on down to be a contestant on The Price Is Right and take your chances at becoming the big showcase winner. Ages 18 and up Deadline for...
 
 

VA disability claims backlog drops by 44 percent

One year after the backlog of pending disability compensation claims peaked at over 611,000 in March 2013, the Department of Veterans Affairs (VA) has reduced that number by approximately 44 percent to 344,000 claims, a reduction of more than 267,000, while at the same time improving the accuracy of the decisions being made on veterans’...
 




0 Comments


Be the first to comment!


Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>


Directory powered by Business Directory Plugin