Federal Employees News Digest
Federal Benfits Q&A
- By FEND Staff
- May 18, 2020
Question: Assuming a FERS employee is contributing at least 5% of basic pay to the TSP, how are agency matching contributions treated when there are two subaccounts in the employee TSP account -- a traditional TSP and a Roth TSP?
I understand that the agency contributions are pre-tax and therefore cannot be deposited into the Roth TSP, but are they then deposited into the Traditional TSP if the employee's contributions during that year are all going into the Roth TSP?
In other words, I may cease contributions into my Traditional TSP and only have them go into the Roth TSP. Will I continue to receive my agency matching contributions (assuming I am still contributing at least 5%)?
Answer: No matter which TSP account (traditional or Roth, or a combination of both) a FERS-covered employee contributes to, the employee's agency will always contribute both the automatic (1% of the employee's SF 50 salary) and matching contributions to the employee's traditional TSP account. The agency contributes nothing to the employee's Roth TSP account.