TSP withdrawal rules and timeline: the basics by age
You can generally take money out of the TSP while still working once you're 59½, and any time after you leave federal or military service. Withdrawals before 59½ usually owe a 10% IRS early-withdrawal penalty on the taxable part, unless an exception applies, such as leaving service in or after the year you turn 55 (50 for public-safety employees). Traditional balances must start coming out at 73 or 75, depending on your birth year; Roth balances don't have to. Once you submit a request, the TSP processes it that night if it's in before noon Eastern on a business day, and the bank account or address receiving the money must have been on file for at least seven days.
Key ages
| Age or event | What it means |
|---|---|
| Any age, while working | Loans and financial-hardship withdrawals only (with limits) |
| 59½, while working | Age-based in-service withdrawals (at least $1,000 each), no early-withdrawal penalty |
| Leaving service in or after the year you turn 55 | Withdrawals avoid the 10% penalty, even before 59½ ("rule of 55") |
| Public-safety employees: in or after the year you turn 50, or with 25 years of covered service | Same penalty exception, earlier |
| 59½ | The 10% early-withdrawal penalty no longer applies |
| 73 (born 1951–1959) or 75 (born 1960 or later) | Required minimum distributions begin from traditional balances |
Still working? See TSP in-service withdrawals for the age-59½ and financial hardship rules.
Ways to take money out after leaving service
- Single payment: one withdrawal of any amount (you can take more than one over time).
- Installments: monthly, quarterly or yearly, either a fixed dollar amount or an amount based on IRS life-expectancy tables.
- Life annuity: a monthly payment for life, purchased from the TSP's annuity provider.
- A mix of the above, and you can leave the rest invested in the TSP.
You can also move TSP money into an IRA or another eligible employer plan, or roll money from those into the TSP.
TSP withdrawal timeline: how long it takes
- Processing: the TSP processes withdrawal requests every business day. Requests entered before noon Eastern time are processed that night; requests after noon are processed the next business night. You can cancel or change a request only until noon on the day it is scheduled to process.
- The 7-day hold: the bank account or mailing address receiving the money must be on file for at least seven days before it can receive funds. Update it a week before you submit.
- Delivery: the TSP says to allow a few days for payment processing. A lost, stolen, damaged or misdirected check can take six weeks or longer to replace.
- Installments: after the first payment, installments are paid on the 15th of each month they're due. If the 15th falls on a weekend or holiday, they're paid the business day before.
Withdrawals can't be reversed once they've been processed.
Taxes, briefly
- Traditional withdrawals are taxed as income (except contributions from tax-exempt combat-zone pay).
- Roth withdrawals are tax-free once qualified: 5 years after your first Roth contribution and age 59½ (or disability or death). See Roth vs traditional TSP.
- The TSP withholds federal income tax from most withdrawals: 20% from single withdrawals and short installments, 10% from hardship withdrawals and RMDs. See how TSP withdrawals are taxed.
Common questions
How long does it take to get money from a TSP withdrawal?
A request entered before noon Eastern on a business day is processed that night; after noon, it's processed the next business night. Allow a few more days for the payment to arrive. Your bank account or mailing address must have been on file for at least seven days, or the payment can't be sent there.
When can I withdraw from my TSP without penalty?
At age 59½, or earlier if you leave federal or military service in or after the calendar year you turn 55 (50 for public-safety employees, or with 25 years of covered service). Other IRS exceptions, such as disability, may also apply.
Can I take money out of the TSP while still working?
Yes, once you're 59½, through age-based in-service withdrawals of at least $1,000. Before that, only TSP loans and financial-hardship withdrawals are available while you're working.
When do TSP required minimum distributions start?
At 73 if you were born from 1951 to 1959, and at 75 if you were born in 1960 or later. They apply to traditional balances; Roth TSP balances no longer have lifetime required distributions.
Do I have to take my TSP money when I leave service?
No. You can leave it invested in the TSP after you separate, until required minimum distributions begin.
Sources
- TSP fact sheet: leaving federal employment
- TSP booklet: in-service withdrawals
- tsp.gov: withdrawals and required minimum distributions
- tsp.gov: Taking money from your account: payment timing, 7-day hold, installments
- tsp.gov: Withdrawals in retirement: daily processing and the noon cutoff
Educational information, not investment or tax advice. Withdrawal rules have exceptions and details; check tsp.gov or a tax professional before making a withdrawal.