2018 Thrift Savings Plan (TSP) Contribution Limits Announced

by | 26Oct2017 | Thrift Savings Plan | 2 comments

The 2018 Thrift Savings Plan contribution limits were announced here:

Elective Deferral Limit $18,500 IRC §402(g) Applies to combined total of traditional and Roth contributions. For members of the uniformed services, it includes all traditional and Roth contributions from taxable basic pay, incentive pay, special pay, and bonus pay, but does not apply to traditional contributions made from tax-exempt pay earned in a combat zone.
Annual Addition Limit $55,000 IRC §415(c) An additional limit imposed on the total amount of all contributions made on behalf of an employee in a calendar year. This limit is per employer and includes employee contributions (tax-deferred, after-tax, and tax-exempt), Agency Automatic (1%) Contributions, and Matching Contributions. For 415(c) purposes, working for multiple Federal agencies or services in the same year is considered having one employer.
Catch-up Contribution Limit $6,000 IRC §414(v) The maximum amount of catch-up contributions that can be contributed in a given year by participants age 50 and older. It is separate from the elective deferral and annual addition limit imposed on regular employee contributions.

If you are a member of the uniformed services, you should know that Roth contributions are subject to the elective deferral limit ($18,500 for 2018) even if they are contributed from tax-exempt pay. If you want to contribute tax-exempt pay toward the annual additions limit, you will have to elect traditional contributions for any amount over the elective deferral limit.

In addition, if you are eligible to make catch-up contributions and you are deployed to a designated combat zone, you will not be able to make any traditional catch-up contributions from your tax-exempt pay. However, Roth catch-up contributions from tax-exempt pay are allowed.

If you are a member of the Ready Reserve and you are contributing to both a uniformed services and a civilian TSP account as a FERS employee, the elective deferral and catch-up contribution limits apply to the total amount of employee contributions you make in a calendar year to both accounts.

If you are called to active duty and make tax-exempt contributions to the TSP while deployed in a designated combat zone, the sum of the employee and agency contributions to your civilian account as well as the tax-exempt contributions made to your uniformed services account cannot exceed the annual addition limit.

USAA
Personal Capital

2 Comments

  1. Mike

    Question. I’m currently on deployment (Oct 2017-Apr 2018). I opted in to the BRS on the 1st of January. I am currently contributing 100% of my basic pay (O-3 with 6 years) into TSP. I should be able to contribute around 21,000 to traditional TSP by the time I go back to the States for the 2018 calendar year. When I head back, if I change my contributions back to roth contributions, can I utilize the rest of the year to contribute another 18,500 (elective deferral limit), or because I won’t be deployed, and I’ve already contributed over that amount, will I be forced not to contribute at all? Basically, I’m wondering if I can contribute toward the 55,000 utilizing just traditional tax exempt while I’m on deployment, and then contribute another 18,500 between May and December so I contribute a total of 39,500? Thanks for the help

    Reply

Submit a Comment

Your email address will not be published. Required fields are marked *

Share This