In the TSP for feds and in 401(k) plans in the private sector, it is important to watch out for excessive elective deferrals!
Check Out Our Next Webinar on Tax Planning for Federal Employees -
FedLife Podcast (ep. #115): The TSP and 401(k) Plans – Watch Out for Excess Elective Deferrals!
What happens when you contribute to the TSP and another qualified retirement plan like a 401(k) in the same year? Just remember the annual contribution limit applies to the individual, not the plan! If contribute too much – you’ll have to pay a penalty to the IRS.
Featured in this episode:
- Contributing to two qualified plans can lead to excess elective deferrals and steep tax penalties.
- Examining what happens when military personnel is on an active tour of duty.
- Contributions that are made from the federal employee’s salary – not the match!
- Codes D and A on your W2, reporting your compensation for a calendar year
- Situations where employees contribute to a 401k and the TSP – switching jobs or retiring.
- IRS Excess Contribution Penalty – 6% of the amount that was over the annual maximum
Like and Subscribe on YouTube at YouTube.com/FedLife
“Securities offered through Raymond James Financial Services, Inc., member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc. Lee, Sipe & Associates, Inc. is not a registered broker/dealer and is independent of Raymond James. Content represents the opinions of the speaker and not necessarily those of Raymond James. Important Disclosure Information: http://raymondjames.com/smicd.htm.
