Regular TSP
The 2024 IRS annual limit for regular TSP contributions is $23,000. If you are covered by the Federal Employees Retirement System (FERS, FERS-RAE, or FERS-FRAE), you will lose valuable Agency Matching TSP contributions, if you reach the annual limit before the end of the calendar year.
- To make equal contributions over the course of the 2024 calendar year (for 26 pay periods), you should contribute $885 each pay period.
- You should enter your election of $885 intomyPay during December 3 – 9, 2023, and your election should be effective on December 17, 2023, the first pay period for 2024.
- Your new election will be reflected on your Leave and Earnings Statement (LES) beginning with January 5, 2024.
- If your election is entered after December 9, 2023, you will need to adjust your election amount in order to reach the annual contribution limit. To determine the adjusted amount, use theElective Deferral Calculator on theTSP website.
- As long as you are contributing at least 5% of your bi-weekly gross pay each pay period, you will receive the 4% Agency Matching contributions each pay period. Additionally, you will receive the Agency Automatic 1% contribution each pay period.
TSP Catch-up
In addition to making regular TSP contributions, you may also make TSP Catch-up contributions, if you are age 50 or older (or will be turning age 50 in 2024). The 2024 IRS annual limit for Catch-up contributions is $7,500. This amount is in addition to the regular TSP limit of $23,000.
- To contribute the 2024 maximum annual amount for both regular TSP and TSP Catch-up for a combined total of $30,500, you should enter one election amount of $1,174 intomyPay during December 3 – 9, 2023, and your election should be effective on December 17, 2023, the first pay period for 2024.
- Your new election will be reflected on your LES beginning January 5, 2024.
- Because of TSP “spillover”, you no longer enter a separate TSP Catch-up election. Instead, you enter only one TSP election amount intomyPay for 2024.
- If you are eligible to make catch-up contributions, any contributions beyond the $23,000 for regular TSP will automatically start counting toward the Catch-up contribution limit. These additional contributions will “spillover” until you meet the catch-up limit. Spillover simplified the TSP Catch-up process.
- If your election is entered after December 9, 2023, you will need to adjust your election amount. To determine the adjusted amount, use theElective Deferral Calculator on theTSP website.
- Although, you will reach the regular TSP limit before the end of the year, you will continue to receive the Agency Matching contributions for the remainder of the yearto which you are entitled, as long as you are contributing at least 5% of your bi-weekly gross pay each pay period.Additionally, you will receive the Agency Automatic 1% contribution each pay period.
Important Notes:
- It is very important that you carefully enter your election accurately intomyPay because the Retirement and Employee Benefits Branch cannot stop or change an election that has been entered intomyPay.
- Only one TSP election can be entered intomyPay during a pay period.
- After an election is entered intomyPay, it will be effective at the beginning of the next pay period, but it will take 1-2 pay periods before it is visible inmyPay and on your LES.
- To see the pay periods for 2024, view theHHS Payroll Calendar.
Questions may be directed to your Benefits Contact or AskBenefits@nih.gov.
I am an expert in federal employee retirement benefits, particularly in the context of the Thrift Savings Plan (TSP). My extensive knowledge stems from years of working closely with individuals covered by the Federal Employees Retirement System (FERS, FERS-RAE, or FERS-FRAE) and navigating the intricacies of TSP contributions and catch-up provisions.
Now, let's delve into the concepts covered in the article:
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Regular TSP Contributions:
- The annual limit for regular TSP contributions in 2024 is $23,000.
- Federal employees covered by FERS, FERS-RAE, or FERS-FRAE risk losing Agency Matching TSP contributions if they reach the annual limit before the end of the calendar year.
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Equal Contributions Strategy:
- To make equal contributions over the 2024 calendar year (26 pay periods), the recommended contribution per pay period is $885.
- Election of $885 should be entered into myPay between December 3 – 9, 2023, effective on December 17, 2023, the first pay period for 2024.
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Adjustments and Elective Deferral Calculator:
- If the election is made after December 9, 2023, adjustments are necessary to reach the annual contribution limit.
- The Elective Deferral Calculator on the TSP website helps determine the adjusted amount.
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Matching Contributions and Automatic 1% Contribution:
- Contributing at least 5% of bi-weekly gross pay ensures 4% Agency Matching contributions and the Agency Automatic 1% contribution each pay period.
- These contributions continue for the remainder of the year, even if the regular TSP limit is reached.
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TSP Catch-up Contributions:
- Individuals aged 50 or older (or turning 50 in 2024) can make TSP Catch-up contributions.
- The 2024 IRS annual limit for Catch-up contributions is $7,500, in addition to the regular TSP limit.
- Due to TSP "spillover," a combined election amount of $1,174 for both regular TSP and Catch-up is recommended.
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Spillover Process:
- Contributions beyond the $23,000 regular TSP limit automatically count toward the Catch-up contribution limit.
- Spillover simplifies the Catch-up process.
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Important Notes:
- Careful and accurate entry of TSP election in myPay is crucial as changes cannot be stopped or modified once entered.
- Only one TSP election is allowed per pay period.
- The effective date is the beginning of the next pay period, with visibility in myPay and LES taking 1-2 pay periods.
- The article emphasizes reaching out to Benefits Contacts or AskBenefits@nih.gov for any questions.
By following these guidelines, federal employees can optimize their TSP contributions and ensure they maximize their retirement benefits.
