Legislation to give federal employees more flexibility with their Thrift Savings Plan accounts was approved Wednesday by the House Committee on Government Reform and referred for a full House vote.
The bipartisan legislation introduced by Reps. Elijah E. Cummings, D-Md., and Mark Meadows, R-N.C., mirrors similar legislation introduced in the Senate on April 6 by Sens. Rob Portman, R-Ohio, and Tom Carper, D-R.I. The Senate version was referred to the Committee on Homeland Security and Governmental Affairs.
Aimed at stemming an estimated $9 billion transferred out of the $482 billion TSP every year into higher-fee accounts when employees leave the federal government, the proposed TSP Modernization Act would allow multiple, partial post-separation withdrawals by retirees. Active federal employees older than 59½ could take multiple age-based withdrawals. The bill also allows quarterly or annual payments, and participants can change periodic withdrawals at any point during the year.
The legislation is supported by the Federal Retirement Thrift Investment Board and government employee organizations.
