TSP board wants to streamline catch-up contributions
- By FederalSoup Staff
- Jan 22, 2020
The Federal Retirement Thrift Investment Board, which governs the Thrift Savings Plan, wants to make it easier for participants to make catch-up contributions.
According to a recent Federal Register notice, in an effort to reduce the amount of paperwork, it is proposing to end the requirement that two different contribution election forms are needed to make catch-up contributions.
A catch-up contribution is a contribution that exceeds a statutory limit on the amount of contributions a participant can normally make to the TSP in each calendar year.
“Instead, the TSP will simply continue to accept contributions based on the participant's contribution election that is already on file, until his/her contributions reach the combined limits on catch-up contributions and other types of contributions,” the notice states, adding, “Employing agency payroll offices will no longer submit catch-up contributions to the TSP on special payroll records designed specifically for catch-up contributions. Instead, payroll offices will submit catch-up contributions using the same payroll records that they use to submit other types of contributions.”
The proposed effective date for this change is Jan. 1, 2021.