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TSP Contribution Amounts & Types

Key Points:

  • Maximum Annual Contribution Amounts

  • Regular Employee Contributions

  • Catch-Up Contributions

How Much Can I Contribute to my TSP?

Each year the IRS determines the annual maximum contribution amount that an individual can contribute for that tax year to tax-deferred savings plans such as the TSP. This is known as the elective deferral limit and for most people a tax year is January 1 – December 31.TSP percentage restrictions (limits) were eliminated in 2006 and replaced with the elective deferral limit.


It’s important to understand that the elective deferral limit does not apply to Agency Automatic (1%) Contributions or Agency Matching Contributions to the TSP because those contributions are not considered part of your pay. It also does not apply to “catch-up” contributions for participants age 50 and above; there is a separate limit for those. However, it does apply to the combined total of ALL elective deferrals you make to any plan for the year…for example, if you have both a civilian and uniformed services TSP account.


Currently, when an employee reaches the annual elective deferral limit, AKA the IRS Contribution Limit, the TSP system will not allow additional contributions and they are suspended for the remainder of the year. If you are a FERS employee and you reach the IRS maximum elective deferral limit before the last pay date of the year, you will not receive all the matching agency contributions to which you’d otherwise be entitled because you must contribute to receive the agency match.


However, beginning in January, 2021, the TSP will switch to the “spillover” method for catch-up contributions which will eliminate the suspension of contributions once you reach the elective deferral limit for eligible participants – see below for details.


Types of Contributions

There are two types of employee contributions to the TSP:

  • Regular Employee Contributions

  • Catch-Up Contributions


Regular Employee Contributions, also called elective deferrals, can begin at any time and are amounts that you ask your agency to deduct from your pay. The contributions come out of your basic pay via payroll deduction and it’s your choice whether these contributions are traditional (before-tax) or Roth (after-tax) contributions. Your agency will continue to process TSP deductions and make contributions until one of four things occurs:

  1. You make a new election changing the amount, or

  2. You elect to stop your contributions, or

  3. You reach the IRS contribution limit, or

  4. You take a financial hardship withdrawal.

For more information, check out the TSP website page addressing the Annual Limit on Elective Deferrals here Note that if you’re a FERS participant, be sure you don’t reach the elective deferral limit too early in the year because you’ll miss out on Agency Matching Contributions.


Catch-Up Contributions are voluntary payroll deductions available for TSP participants who are age 50 or older and are in addition to regular employee contributions. In fact, you must contribute the maximum amount of regular contributions to be eligible to make catch-up contributions. In other words, you must already be contributing an amount that will reach the IRS Elective Deferral Limit by the end of the year to be eligible to make catch-up contributions. What you may not know is that the regular contributions required for eligibility to make catch-up contributions can be made to the TSP OR an equivalent tax-deferred employer plan, such as a private sector 401(k)..


In the year that you turn 50, you can begin making traditional (before-tax) or Roth (after-tax) catch-up contributions at any time and they will stop automatically when you meet the IRS catch-up contribution limit for the year or at the end of the year, whichever comes first. Please note that currently your catch-up contributions will not continue from year to year; you have to make a new election for each calendar year. And if you are a FERS participant, you will not receive Agency Matching Contributions on any catch-up contributions that you make to your TSP.For more information about TSP Catch-Up Contributions, click here.


Things are changing, though, beginning with the first pay period in January, 2021 when the TSP will switch to the “spillover” method for catch-up contributions. You will no longer be required to make a separate election for catch-up contributions. Instead, once a participant age 50 or older reaches the Elective Deferral Limit (EDL) in the TSP, their regular contributions will continue, “spillover” and start counting toward the catch-up contribution limit. The two types of contributions will no longer be tracked separately AND agency matching contributions for FERS participants will continue up to the maximum 5 percent of salary. To learn more about the 2021 changes to catch-up contributions, click here.


Action Steps:

  • Be aware that the combined total of your traditional (before-tax) and Roth (after-tax) TSP contributions cannot exceed the annual elective deferral limit. Catch-up contributions are not included in the elective deferral limit and have a separate limit.

  • If you plan to contribute the maximum allowed for the year and you are a FERS participant, pay attention to when you’ll reach the elective deferral limit so that you don’t lose agency matching contributions. The How Much Can I Contribute calculator can help you determine the specific dollar amount per pay period.

  • For further information about Agency Matching TSP matching contributions, please refer to the Tangerine article, “TSP Overview for Federal Employees.”



Publish Date: October 13, 2020 © Tangerine, Inc. All rights reserved. The information contained herein constitutes general information and is not directed to, designed for, or individually tailored to, any particular individual or circumstance. This article is not intended to be a client-specific analysis or recommendation. Do not use this article as the sole basis for any financial decisions. Consider all relevant information. Information should not be considered as tax or legal advice. You should consult with your tax advisor and/or attorney regarding your individual circumstances.


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