Partial TSP Withdrawal Direct to Roth IRA?

[uscfanhawaii]

I've been playing with a tool called i-ORP tool and it's suggesting there are advantages to moving a relatively large chunks of my TSP into a Roth IRA (over about a 7 or 8 year period).

I don't want to discuss the pros and cons of what the tool is suggesting but I do want to discuss the mechanics of doing it. I know the withdrawal rules are going to expand soon but I'd like to get started with the transfer now and hope the new rules are implemented sometime in 2019 to allow follow-up partial transfers.

I don't want to rollover my entire TSP balance to a traditional IRA then start the conversion. I'd like to do it as partial TSP withdrawals directly to a Roth IRA account.

This is my plan using TSP-77 to do a partial withdrawal
1. Enter the amount to transfer in section II
2. Check the transfer election box in section III
3. Sign and notarize sections VI and VII
4. Send the form to Vanguard (in my case) to have them complete section X (checking the Roth IRA box on line 34 and use my newly opened Roth IRA account number on line 35).
5. Prepare to pay a large amount of tax using funds from another non-retirement account.
6. Repeat the steps above once the new expanded withdrawal rules are in place.

Let me know if these steps will work or what I should do differently.

Should work. Key is having the funds to pay for the taxes due.

I did the same thing several years ago when I set up my Vanguard Roth IRA. As long as it goes directly between financial institutions, it works smoothly.

 

[geobrick]

I've been playing with a tool called i-ORP tool and it's suggesting there are advantages to moving a relatively large chunks of my TSP into a Roth IRA (over about a 7 or 8 year period).

I don't want to discuss the pros and cons of what the tool is suggesting but I do want to discuss the mechanics of doing it. I know the withdrawal rules are going to expand soon but I'd like to get started with the transfer now and hope the new rules are implemented sometime in 2019 to allow follow-up partial transfers.

I don't want to rollover my entire TSP balance to a traditional IRA then start the conversion. I'd like to do it as partial TSP withdrawals directly to a Roth IRA account.

This is my plan using TSP-77 to do a partial withdrawal
1. Enter the amount to transfer in section II
2. Check the transfer election box in section III
3. Sign and notarize sections VI and VII
4. Send the form to Vanguard (in my case) to have them complete section X (checking the Roth IRA box on line 34 and use my newly opened Roth IRA account number on line 35).
5. Prepare to pay a large amount of tax using funds from another non-retirement account.
6. Repeat the steps above once the new expanded withdrawal rules are in place.

Let me know if these steps will work or what I should do differently.