Question about TSP Max Contributions Limits (Traditional/Roth Mix)

[bn0world]

Greetings, I am new to the TSP Talk forums so here we go ..

I have asked multiple HR reps in my office and they keep telling me different answers. I'm a new TSP Talk member in the past year so I wanted to throw this question out to the community. I have always invested the maximum into my TSP account ($18k for 2017), which is roughly $693/pp. I contribute $643 Traditional/$50 Roth each pp. If the Roth portion is actually after-tax contributions, am I allowed to increase my pre-tax contributions (traditional) to the max of $693/pp AND continue to contribute up to the max annual Roth ($5,500) limit within the TSP? My wife and I both have separate Roth IRAs that we max out as well. Any advise is greatly appreciated.

 

[alevin]

Roth outside account has nothing to do with tsp. You can contribute full allowed 5500 to your roth AND max out your tsp account (18000).

If you contribute to Roth tsp as well as regular tsp, the grand total in tsp (regular tsp+Roth tsp) cannot exceed 18000. sounds like you are doing things just right currently. don't change a thing. total into tsp (regular+roth) total 693/pp. x 26pp =18000. don't bump the roth tsp unless you cut back on the regular tsp contributions to even things back out. the link below discusses this very thing. note that the max for combined regular + roth tsp for 2018 has bumped up to 18500.


https://www.tsp.gov/PlanParticipation/EligibilityAndContributions/contributionLimits.html

 

[RazorCat]

Don’t know where you’re located, but you might look around for available TSP retirement seminars. Attend every one you can.
Might suggest to your (usually TSP uninformed) HR staff that a local class would be something that would be well received by staff, and reduce questions they haven’t been schooled in answering. They’re very informative. I agree you’d think HR staff would know basic ins and outs of TSP, but in their defense most never receive much training on it past their own willingness to learn it. Here’s the TSP publication and an article on the subject. alevin is spot on.

https://www.tsp.gov/PDF/formspubs/tspfs07.pdf
https://finance.zacks.com/tsp-contributions-affect-ira-1233.html

Try Fedsmith Or Myfederalretirement. Both sites have tons of information on TSP.
And remember, a TSP Roth isn’t really a Roth IRA in the true sense. I always contributed the TSP max to a traditional, and did my Roth outside of TSP.

 

[uscfanhawaii]

And don’t forget the extra catch-up contributions once you are 50 years old!!
$5500!

 

[James48843]

Roth outside account has nothing to do with tsp. You can contribute full allowed 5500 to your roth AND max out your tsp account (18000).

If you contribute to Roth tsp as well as regular tsp, the grand total in tsp (regular tsp+Roth tsp) cannot exceed 18000. sounds like you are doing things just right currently. don't change a thing. total into tsp (regular+roth) total 693/pp. x 26pp =18000. don't bump the roth tsp unless you cut back on the regular tsp contributions to even things back out. the link below discusses this very thing. note that the max for combined regular + roth tsp for 2018 has bumped up to 18500.


https://www.tsp.gov/PlanParticipation/EligibilityAndContributions/contributionLimits.html

One problem with this- and I hit it this year, with the ROTH TSP and standard TSP-

DIFFERENT FEDERAL AGENCIES MAY HAVE DIFFERENT NUMBERS OF BIWEEKLY PAY PERIODS- AND 2018 IS GOING TO BE 27 , not 26 pay periods, FOR MANY AGENCIES.

THIS YEAR iit happened to me- there are 27, not 26, pay periods where I am.

So I hit the magic max $18,000 in the 26th pay period, and that means I will NOT get any matching contribution NEXT pay period, AND that my TSP contribution will not make it to my account for the 27th pay period. Luckily, the clock starts ticking all over again in Pay Period #1 in January.

Note- according to my leave and earnings slip, they automatically stopped my ROTH once I hit the total of 18K this past pay period. They put in the last $692 (*somehow I was $2 less than the normal deduction), and then took out ZERO for my Roth this past pay period.

See this article about how some agencies will have 27 pay periods in 2018:

https://federalnewsradio.com/pay/20...years-payroll-calendars-theyre-all-different/

 

[weatherweenie]

The catch-up amount is $6,000, isn't it?

And don’t forget the extra catch-up contributions once you are 50 years old!!
$5500!

 

[James48843]

TSP Contribution Limits for 2018


Don't miss out on matching contributions.

If you are a FERS employee and your contributions reach the IRS elective deferral limit before the last pay date of the year, you will not receive all of the matching contributions to which you would otherwise be entitled. Use the calculator, How much can I contribute?to ensure that you don't leave any money on the table.



The Internal Revenue Code (IRC) places limits on the dollar amount of contributions you can make to the TSP. The Internal Revenue Service (IRS) calculates them every year and they can change annually. The TSP announces the limits on the TSP website and the ThriftLine as well as through its various publications when the limits become available.



[TABLE="class: tableRegular, width: 493"]
[TR]
[TD]Elective Deferral Limit[/TD]
[TD="class: right, align: right"]$18,500[/TD]
[TD="class: nowrap"]IRC §402(g)[/TD]
[TD]Applies to combined total of traditional and Roth contributions. For members of the uniformed services, it includes all traditional and Roth contributions from taxable basic pay, incentive pay, special pay, and bonus pay, but does not apply to traditional contributions made from tax-exempt pay earned in a combat zone.[/TD]
[/TR]
[TR]
[TD]Annual Addition Limit[/TD]
[TD="class: right, align: right"]$55,000[/TD]
[TD="class: nowrap"]IRC §415(c)[/TD]
[TD]An additional limit imposed on the total amount of all contributions made on behalf of an employee in a calendar year. This limit is per employer and includes employee contributions (tax-deferred, after-tax, and tax-exempt), Agency Automatic (1%) Contributions, and Matching Contributions. For 415(c) purposes, working for multiple Federal agencies or services in the same year is considered having one employer.[/TD]
[/TR]
[TR]
[TD]Catch-up Contribution Limit[/TD]
[TD="class: right, align: right"]$6,000[/TD]
[TD="class: nowrap"]IRC §414(v)[/TD]
[TD]The maximum amount of catch-up contributionsthat can be contributed in a given year by participants age 50 and older. It is separate from the elective deferral and annual addition limit imposed on regular employee contributions.[/TD]
[/TR]
[/TABLE]


If you are a member of the uniformed services, you should know that Roth contributions are subject to the elective deferral limit ($18,500 for 2018) even if they are contributed from tax-exempt pay. If you want to contribute tax-exempt pay toward the annual additions limit, you will have to elect traditional contributions for any amount over the elective deferral limit.
In addition, if you are eligible to make catch-up contributions and you are deployed to a designated combat zone, you will not be able to make any traditional catch-up contributions from your tax-exempt pay. However, Roth catch-up contributions from tax-exempt pay are allowed.


If you are a member of the Ready Reserve and you are contributing to both a uniformed services and a civilian TSP account as a FERS employee, the elective deferral and catch-up contribution limits apply to the total amount of employee contributions you make in a calendar year to both accounts.

If you are called to active duty and make tax-exempt contributions to the TSP while deployed in a designated combat zone, the sum of the employee and agency contributions to your civilian account as well as the tax-exempt contributions made to your uniformed services account cannot exceed the annual addition limit.

Source:
https://www.tsp.gov/PlanParticipation/EligibilityAndContributions/contributionLimits.html