[Federal Register Volume 70, Number 197 (Thursday, October 13, 2005)]
[Rules and Regulations]
[Page 59621]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-20483]



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Rules and Regulations
                                                Federal Register
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Federal Register / Vol. 70, No. 197 / Thursday, October 13, 2005 / 
Rules and Regulations

[[Page 59621]]



FEDERAL RETIREMENT THRIFT INVESTMENT BOARD

5 CFR Part 1650


In-Service Hardship Withdrawals From the Thrift Savings Plan

AGENCY: Federal Retirement Thrift Investment Board.

ACTION: Temporary rule.

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SUMMARY: This document contains temporary regulations that lift certain 
restrictions on financial hardship in-service withdrawals from Federal 
employees' and uniformed service members' Thrift Savings Plan (TSP) 
accounts. These temporary regulations are intended to assist TSP 
participants who were affected by Hurricane Katrina.

DATES: Effective Date: These regulations are effective October 1, 2005, 
through December 31, 2005.

FOR FURTHER INFORMATION CONTACT: Office of Benefits Services, Federal 
Retirement Thrift Investment Board, 1250 H Street, NW., Washington, DC 
20005, 202-942-1460.

SUPPLEMENTARY INFORMATION: The Board administers the TSP, which was 
established by the Federal Employees' Retirement System Act of 1986 
(FERSA), Public Law 99-335, 100 Stat. 514. The TSP provisions of FERSA 
have been codified, as amended, largely at 5 U.S.C. 8351 and 8401-79. 
The TSP is a tax-deferred retirement savings plan for Federal civilian 
employees and members of the uniformed services. The TSP is similar to 
cash or deferred arrangements established for private-sector employees 
under section 401(k) of the Internal Revenue Code (26 U.S.C. 401(k)).
    The TSP is managed by five part-time Presidentially-appointed Board 
members and an Executive Director. FERSA gives the Executive Director 
authority to prescribe regulations permitting participants to make 
limited withdrawals from their TSP accounts before they are separated 
from Government employment. 5 U.S.C. 8433(h)(4). This temporary 
regulation is based upon that authority and the provisions of 5 U.S.C. 
553(d)(1) and (3).
    Currently, the TSP's regulations prohibit participants from 
requesting a financial hardship in-service withdrawal from their 
accounts if they have received another financial hardship withdrawal 
within the last six months; the temporary regulation deletes that 
restriction for a financial need that results from Hurricane Katrina. 
In addition, a participant who obtains a financial hardship in-service 
withdrawal may not contribute to the TSP for a period of six months 
after the withdrawal is processed. The temporary regulation provides 
that the TSP will not extend this contribution suspension period if the 
participant's contributions have already been suspended due to a 
previous hardship distribution.

Regulatory Flexibility Act

    I certify that these regulations will not have a significant 
economic impact on a substantial number of small entities. They will 
affect only employees of the Federal Government.

Paperwork Reduction Act

    I certify that these regulations do not require additional 
reporting under the criteria of the Paperwork Reduction Act of 1980.

Unfunded Mandates Reform Act of 1995

    Pursuant to the Unfunded Mandates Reform Act of 1995, 2 U.S.C. 602, 
632, 653, 1501-1571, the effects of this regulation on state, local, 
and tribal governments and the private sector have been assessed. This 
regulation will not compel the expenditure in any one year of $100 
million or more by state, local, and tribal governments, in the 
aggregate, or by the private sector. Therefore, a statement under 
section 1532 is not required.

List of Subjects in 5 CFR Part 1650

    Employee benefit plans, Government employees, Pensions, Retirement.

Gary A. Amelio,
Executive Director Federal Retirement Thrift Investment Board.

0
For the reasons set forth in the preamble, the Board proposes to amend 
5 CFR chapter VI as follows:

PART 1650--METHODS OF WITHDRAWING FUNDS FROM THE THRIFT SAVINGS 
PLAN

0
1. The authority citation for part 1650 continues to read as follows:

    Authority: 5 U.S.C. 8351, 8433, 8434, 8435, 8474(b)(5), and 
8474(c)(1).

0
2. Amend Sec.  1650.33 by adding a new paragraph (c) to read as 
follows:


Sec.  1650.33  Contributing to the TSP after an in-service withdrawal.

    (a) * * *
    (b) * * *
    (c) Notwithstanding the provisions of paragraph (b) of this 
section, a participant who obtains a financial hardship in-service 
withdrawal based upon a financial need caused by Hurricane Katrina and 
who is not, at the time of the second hardship withdrawal, making 
contributions because of a previous financial hardship withdrawal will 
not have his/her contribution suspension period further extended. The 
participant may submit a new TSP contribution election to resume 
contributions any time after expiration of the original six-month 
contribution suspension period.
0
3. Amend Sec.  1650.42 by adding a new paragraph (c) to read as 
follows:


Sec.  1650.42  How to obtain a financial hardship withdrawal.

    (c) * * *
    (d) * * *
    (c) Notwithstanding the provisions of paragraph (b) of this 
section, the TSP will accept at any time a financial hardship 
withdrawal request that is based upon a financial need caused by 
Hurricane Katrina. The participant must certify on the application that 
the financial need is related to a hardship caused by Hurricane 
Katrina.

[FR Doc. 05-20483 Filed 10-12-05; 8:45 am]
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