TSP bill heads to White House
- By FederalSoup Staff
- Nov 08, 2017
The TSP Modernization Act has passed the House and Senate and is now headed to the president for approval.
Sens. Rob Portman (R-Ohio) and Tom Carper (D-Del.) introduced the bill (H.R. 3031), which loosens TSP withdrawal restrictions.
Current TSP withdrawal rules only allow age-based withdrawals for federal employees while they are employed, and then they cannot make a partial withdrawal once they leave government and are forced to transfer their retirement accounts out of the TSP to higher-fee accounts upon separating from federal employment. The bill updates these rules that have been in place since TSP was established in 1986.
The bill would allow current federal employees to make multiple age-based withdrawals from their TSP accounts while still remaining eligible for partial withdrawals once they leave government. It also encourages retention in the TSP by allowing the election of quarterly or annual payments as well as periodic withdrawals to be changed at any point during the year.
It passed the Senate without any amendments.