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TSP FOR RESERVE/GUARD

Basic Pay needed!

To participate in TSP, you must have elected a minimum of one percent of your basic pay for either traditional or Roth TSP contribution.

You should use the information below if you are an Army or Air Force reserve component member or a Navy reserve component member drilling or serving 30 days or less on active duty. If you are an Army, Navy or Air Force active component member or a Navy reserve component member serving more than 30 days on active duty see our TSP for Active Duty page for more information.

You may elect Roth or traditional TSP contributions. Traditional TSP contributions are deducted pre-tax; taxes are deferred until you withdraw your contributions. Roth TSP contributions are taken after-tax. If you elect to contribute to TSP, the contributions will be deducted from your pay account. Further information on TSP as well as election forms may be obtained at www.tsp.gov. You may also find information from your command or installation personal financial counselors, or your finance office.

STARTING YOUR TSP CONTRIBUTIONS

Know the contribution limits: The IRS has annual limits for TSP contributions. Stay up-to-date on the latest from the nation's tax authority. 
The first step in planning participation in TSP is reviewing current pay, bonuses and deductions. This will allow you to determine what percentages of your basic pay, special and incentive pays, and bonuses are available for contribution elections. Remember, traditional and Roth contributions are based on your elections of percentages of pay and not on dollar amounts.

Traditional TSP contributions are taken before all other deductions. Roth TSP contributions come from pay available AFTER payroll taxes and deductions have been computed. We’ve developed a worksheet to help you determine the amounts of pay eligible for Roth TSP contributions.

WARNING: Electing a contribution percentage that does not allow for existing deductions will cancel the Roth TSP elections and funds will not be deposited in your Roth TSP account. Deductions include payroll taxes (Social Security and Medicare) as well as forfeitures, federal and state income tax withholding, Service Members’ Group Life Insurance (SGLI) and Family Service Members’ Group Life Insurance (FSGLI) premiums, debts, garnishments, bankruptcies, tax levies, alimony, child support and fines. Visit your finance office if you have any questions about deductions from your pay.

Once you have determined the percentages of each pay category to be contributed to your traditional and/or Roth TSP account, myPay is available to start, change or stop traditional and Roth TSP contributions.

If you do not have access to myPay, a completed and signed Thrift Savings Plan Election Form TSP-U-1 must be submitted to your finance office for processing. Forms are available at https://www.tsp.gov/forms/uniformedServicesForms.shtml

WANT TO CONTRIBUTE FROM A BONUS OR ONE-TIME PAYMENT?

If you will be receiving bonuses or one-time special or incentive payments, you may wish to contribute all or part of those payments to your TSP account. Like other TSP contributions, elections must be stated in percentages rather than dollar amounts.

Because Roth TSP is taken after all other deductions, you will need to calculate how much money is available to contribute to Roth TSP. Many regular payroll deductions may be found by reviewing your current LES; however, federal and state tax withholding of bonuses or other one-time payments will require a little math.

The federal supplemental rate for withholding is set at 25 percent. State supplemental rates vary state to state. Take a look at your state's current supplemental rates.

Multiply the amount of the gross bonus or one-time payment by the combined federal and state withholding percentages to get an estimate of your tax liability. Add this to your other deductions and subtract from the payment amount. If, for instance, all of your deductions equal 40 percent of your one-time payment, you cannot make an election of more than 60 percent for Roth TSP contributions.

CHANGING YOUR TSP ELECTIONS

Life, and your financial needs and goals change. Whether you need to reduce your contribution elections to balance your home budget or increase them to meet your future goals, you MUST enter contribution percentages in all pay categories when submitting changes either via myPay or a TSP-U-1. For example, if you are satisfied with most of your current elections, but wish to increase the percentage of basic pay, you must repeat your current elections in each pay category along with the increased percentage for basic pay.

Failure to submit the correct percentage in each pay category will cause your contribution elections for unmarked categories to be recorded as zero percent.

RESERVE AND GUARD ACTIVATION

Army and Air Force reservists and Guard members continue to be paid from the same system whether in a drill status or activated for active duty service. Your traditional and Roth elections will continue unaffected by the change in pay status.

For Navy reservists: Pay computation for members who serve on a period of active duty of more than 30 days is transferred to the pay system that supports active duty members. To continue traditional or Roth TSP, new elections must be submitted via myPay or a TSP-U-1 form. form. Following transfer back to the reserve pay system, your previous TSP elections may be restored. See your finance office to verify whether a new election is needed.

CATCH-UP CONTRIBUTIONS

If you are age 50 or over or will become 50 this calendar year, you may be eligible to make additional contributions to TSP, called “catch-up contributions.” Read more to find out if this option is right for you.
Updated Feb. 28, 2014