TSP Roth implementation a work in progress


The Federal Retirement Thrift Investment Board emphasized Monday that the Thrift Savings Plan’s Roth option is an ongoing endeavor; fully verifying that all Roth transactions are working correctly will take years.

Roth program manager Karen Vaughn told board members at a monthly meeting the plan was in a post-deployment phase of implementation. Four federal employees have seen their Roth contributions reflected in their paychecks already this month. More are expected to see their contributions after the next pay period, at the end of May, and the TSP board then will have better, more updated numbers of current participants.

“[Opting in] really is a very personal decision, and we’re not sure how it’s going to take in the federal employee community,” said Kim Weaver, the board’s external affairs director.

About three-fifths of federal employees have been unable to enroll since the option became available May 7. The Federal Retirement Thrift Investment Board was ready to enroll employees at that time, but payroll systems at many agencies were unprepared for the shift.

The Roth option will be available to Marine Corps members in June; to Defense and Veterans Affairs department civilians in July; and to Army, Navy and Air Force service members by October, according to the Defense Finance and Accounting Service, which has cited complicated pay systems as the reason for the delay.

Vaughn said she expects more data on enrollments will become available next month. She emphasized that although some performance data is already available, it will take some time before participants exercise all of their possible options to use their Roth money and that the TSP will have to continue to monitor the programming to make sure it works in all situations.  In order to withdraw Roth earnings tax-free, employees typically must be 59 and a half years of age or older, with some exceptions.

The Roth option is similar to a private sector Roth IRA, where employees can invest money that already has been taxed and avoid being hit again when they retire and begin withdrawing money, but there are no income limits for the federal plan. Employees’ total annual TSP contributions must remain within Internal Revenue Service limits. The IRS increased the cap on individual retirement contributions in 2012 to $17,000 from $16,500, due to a change in the cost-of-living index. Employees 50 and older can contribute an additional $5,500.

Overall April participation numbers in the TSP remained steady, at 86.4 percent of Federal Employees Retirement System workers, 40 percent of active duty service members and 15 percent of ready reserves taking part.

Stay up-to-date with federal news alerts and analysis — Sign up for GovExec's email newsletters.
Close [ x ] More from GovExec

Thank you for subscribing to newsletters from GovExec.com.
We think these reports might interest you:

  • Sponsored by G Suite

    Cross-Agency Teamwork, Anytime and Anywhere

    Dan McCrae, director of IT service delivery division, National Oceanic and Atmospheric Administration (NOAA)

  • Data-Centric Security vs. Database-Level Security

    Database-level encryption had its origins in the 1990s and early 2000s in response to very basic risks which largely revolved around the theft of servers, backup tapes and other physical-layer assets. As noted in Verizon’s 2014, Data Breach Investigations Report (DBIR)1, threats today are far more advanced and dangerous.

  • Sponsored by One Identity

    One Nation Under Guard: Securing User Identities Across State and Local Government

    In 2016, the government can expect even more sophisticated threats on the horizon, making it all the more imperative that agencies enforce proper identity and access management (IAM) practices. In order to better measure the current state of IAM at the state and local level, Government Business Council (GBC) conducted an in-depth research study of state and local employees.

  • Sponsored by Aquilent

    The Next Federal Evolution of Cloud

    This GBC report explains the evolution of cloud computing in federal government, and provides an outlook for the future of the cloud in government IT.

  • Sponsored by LTC Partners, administrators of the Federal Long Term Care Insurance Program

    Approaching the Brink of Federal Retirement

    Approximately 10,000 baby boomers are reaching retirement age per day, and a growing number of federal employees are preparing themselves for the next chapter of their lives. Learn how to tackle the challenges that today's workforce faces in laying the groundwork for a smooth and secure retirement.

  • Sponsored by Hewlett Packard Enterprise

    Cyber Defense 101: Arming the Next Generation of Government Employees

    Read this issue brief to learn about the sector's most potent challenges in the new cyber landscape and how government organizations are building a robust, threat-aware infrastructure

  • Sponsored by Aquilent

    GBC Issue Brief: Cultivating Digital Services in the Federal Landscape

    Read this GBC issue brief to learn more about the current state of digital services in the government, and how key players are pushing enhancements towards a user-centric approach.


When you download a report, your information may be shared with the underwriters of that document.