Regular employee contributions
Each pay period, your agency or service will deduct your contribution from your basic pay in the amount or percentage that you chose when you started contributing (or at 3% of your pay if you were automatically enrolled and haven’t made any changes).
Your agency or service will continue to deduct your contribution until you do the following:
- Make a new election changing the amount
- Elect to stop your contributions
- Reach the IRS contribution limit
For more information, visit Contribution limits.
Agency/Service Automatic (1%) Contributions
If you’re a FERS or BRS employee, your agency or service will contribute an amount equal to 1% of your basic pay each pay period to your TSP account. These are called Agency/Service Automatic (1%) Contributions and you don’t need to make employee contributions to receive them.
Agency/Service Automatic (1%) Contributions are not taken out of your pay and do not reduce your pay for income tax purposes.
A few words about vesting
- Being “vested” means you’re entitled to keep all of the money in your account. Vesting only applies to Agency/Service Automatic (1%) Contributions (and their earnings) and occurs after you work in the federal government or uniformed services for a certain number of years. All your years of service in a position eligible for the TSP count toward vesting, even if you don’t contribute to the TSP during that time. Most FERS participants are vested in Agency/Service Automatic (1%) Contributions after completing 3 years of service.
- FERS employees in congressional and certain noncareer positions become vested in Agency Automatic (1%) Contributions after 2 years of service.
- BRS members become vested in Service Automatic (1%) Contributions after 2 years of service.
If you leave government service before satisfying the vesting requirement, the Agency/Service Automatic (1%) Contributions and their earnings will be forfeited to the TSP. If you die before separating from service, you are automatically considered vested in all the money in your account.
Agency/Service Matching Contributions
If you’re a FERS or BRS participant, you will receive Agency/Service Matching Contributions from your agency or service based on your regular employee contributions once you’re eligible. Unlike Agency/Service Automatic (1%) Contributions, Matching Contributions are not subject to vesting requirements.
As a FERS or BRS participant, you receive matching contributions on the first 5% of pay that you contribute each pay period.
|Your Biweekly Contribution||Automatic 1% Contribution||Agency Matching Contribution||Total Contributions|
|5% +||1%||4%||Your % + 5%|
The first 3% of pay that you contribute will be matched dollar-for-dollar; the next 2% will be matched at 50 cents on the dollar. Contributions above 5% of your pay will not be matched. If you stop making regular employee contributions, your matching contributions will also stop.
Further, your Agency/Service Matching Contributions are based on the total amount of money (traditional and Roth) that you contribute each pay period. All agency/service contributions are deposited into your traditional balance.
Starting in the year you turn 50, you may be eligible to make catch-up contributions to your TSP account in addition to your regular employee contributions.
Here’s what you should know:
- You must already be contributing an amount that will reach the IRS annual contribution limit. To see the most current limits, visit Contribution Limits.
- You may start, change, or stop making catch-up contributions at any time.
- There are no matching contributions for catch-up contributions.
- You must make a new election each calendar year—they do not restart automatically.
If you are a uniformed services member and enter a combat zone, your catch-up contributions must be Roth. (The TSP cannot accept traditional tax-exempt contributions toward the catch-up limit.) You also cannot make catch-up contributions from incentive pay, special pay, or bonus pay.
To make a catch-up contribution election, use your agency’s or service’s payroll website (e.g., Employee Express, EBIS, LiteBlue, myPay, or NFC EPP) or complete the Catch-Up Contribution Election, Form TSP-1-C (or TSP-U-1-Cfor uniformed services) and submit it to your payroll office. Or call the ThriftLine at 1-877-968-3778 and choose option 3 to request a copy.
A note for members of the uniformed services
If you are a member of the uniformed services:
- You can contribute from 1 to 100 percent of any incentive pay, special pay, or bonus pay (even if you’re not currently receiving them)— as long as you elect to contribute from your basic pay.
- You cannot contribute from sources such as housing or subsistence allowances.
- Contributions from tax-exempt pay will also be tax-exempt.
Note: If you contribute tax-exempt pay, your total contributions from all types of pay must not exceed the IRS annual addition limit for the year.
For more information, visit Contribution Limits.