When Can You Withdraw from a TSP Tax-Free?

Shawn Plummer, CRPC

Chartered Retirement Planning Counselor

Traditional TSP Withdrawals

Roth TSP Withdrawals

  • Tax-Free Age: Withdrawals from a Roth TSP are tax-free starting at age 59 1/2.
  • Condition: To qualify for tax-free withdrawals, the Roth TSP account must be held for at least 5 years.

Strategies to Offset Taxes in Traditional TSP

Rolling Over into a Deferred IRA Annuity

Conclusion

Understanding the tax implications of TSP withdrawals is crucial for effective retirement planning. Traditional TSP withdrawals are always taxable, while Roth TSP offers tax-free withdrawals after 59 1/2, subject to certain conditions. To mitigate tax liabilities on a traditional TSP, consider rolling it into a deferred IRA annuity with a premium bonus. This strategy can provide financial benefits and reduce the tax burden. For personalized advice and detailed planning, contact us today for a free quote.

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Shawn Plummer, CRPC

Chartered Retirement Planning Counselor

Shawn Plummer is a Chartered Retirement Planning Counselor, insurance agent, and annuity broker with over 14 years of first-hand experience with annuities and insurance. Since beginning his journey in 2009, he has been pivotal in selling and educating about annuities and insurance products. Still, he has also played an instrumental role in training financial advisors for a prestigious Fortune Global 500 insurance company, Allianz. His insights and expertise have made him a sought-after voice in the industry, leading to features in renowned publications such as Time Magazine, Bloomberg, Entrepreneur, Yahoo! Finance, MSN, SmartAsset, The Simple Dollar, U.S. News and World Report, Women’s Health Magazine, and many more. Shawn’s driving ambition? To simplify retirement planning, he ensures his clients understand their choices and secure the best insurance coverage at unbeatable rates.

The Annuity Expert is an independent online insurance agency servicing consumers across the United States. The goal is to help you take the guesswork out of retirement planning and find the best insurance coverage at the cheapest rates

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