Thrift Savings Plan to Allow Financial Hardship Withdrawals

Postal and federal employees affected by Hurricane Sandy will find it easier to tap into retirement savings to help repair their homes, replace lost property, or to aid family members suffering from the massive storm, which devastated hundreds of communities in the northeast.

To assist Hurricane Sandy victims, the Thrift Savings Plan (TSP), a tax-deferred retirement savings and investment plan for government workers, has announced temporary changes to its withdrawal rules.

The changes allow participants to take a hardship withdrawal while continuing to make TSP contributions in the 6-month period after withdrawing the funds.

As of Nov. 21, 2012, the TSP will treat a Financial Hardship In-Service Withdrawal Requests as a qualifying hardship under its temporary Hurricane Sandy rules, provided enrollees:

• Live or work in a covered disaster area and have incurred a loss as a result of Hurricane Sandy, or
• Will use their withdrawals to assist eligible family members who live or work in a covered disaster area and suffered losses from the storm.

Requests for storm-related TSP financial hardship withdrawals must be received by Jan. 25, 2013, and the withdrawals must occur before Feb. 1, 2013.

Additional requirements must be met to qualify for the special TSP hardship withdrawal program. For complete guidelines and to obtain withdrawal forms visit www.tsp.gov, or call TSP’s toll-free ThriftLine at 877-968-3778 for more information.