Source: https://www.tsp.gov/bulletins/19-u-11/
Timestamp: 2020-08-05 09:09:20
Document Index: 187960499

Matched Legal Cases: ['§ 402', '§ 414', '§ 415', '§ 402', '§ 414', '§ 415']

2020 TSP contribution limits | Thrift Savings Plan
The Internal Revenue Service (IRS) has announced the contribution limits for 2020:
Elective Deferral Limit § 402(g) $19,500 $19,000
Catch-up Contribution Limit § 414(v) $6,500 $6,000
Annual Addition Limit § 415(c) $57,000 $56,000
The IRC § 402(g) elective deferral limit for 2020 is $19,500. This limit applies to the traditional (tax-deferred) and Roth contributions made by a service member during the calendar year. The combined total of traditional (tax-deferred) and Roth contributions made during the calendar year cannot exceed the elective deferral limit. However, the elective deferral limit does not apply to Agency/Service Automatic (1%) Contributions, Agency/Service Matching Contributions, catch-up contributions, traditional contributions made from tax-exempt pay, or amounts transferred or rolled over into the TSP.
The TSP is not allowed to accept a contribution that exceeds the elective deferral limit for the year. If a payroll office submits a contribution that exceeds the elective deferral limit, the TSP will reject the entire contribution and all associated matching contributions, and will send a report to the payroll office showing the additional contributions allowed for the year. Once a participant reaches the elective deferral limit, his or her contributions will be stopped for the rest of the year. This means that FERS and BRS participants who reach the limit before the final pay date of the year will also miss out on matching contributions for the rest of the year. Agencies and services should make FERS and BRS participants aware of what happens when they reach the elective deferral limit. You can refer FERS and BRS participants to the fact sheet, Annual Limit on Elective Deferrals, and the elective deferral calculator, How Much Can I Contribute?, for help with their contribution elections. Both are available at tsp.gov.
The IRC § 414(v) catch-up contribution limit for 2020 is $6,500. Participants who will make contributions to the TSP (or certain other employer sponsored plans) up to the elective deferral limit, and who will be age 50 or older by the end of 2020, may make a catch-up contribution election to contribute additional pay to their TSP accounts. These contributions may be traditional (tax-deferred) and/or Roth and do not count toward the elective deferral limit. Eligible participants elect a whole dollar amount from basic pay, and a new election must be made each year. Service members may elect to make traditional (tax-deferred) and/or Roth catch-up contributions from their taxable pay. Members receiving tax-exempt pay may only elect Roth catch-up contributions. The combined total of traditional (tax-deferred) and Roth catch-up contributions made during the calendar year cannot exceed the catch-up contribution limit.
Age-eligible participants who contribute the maximum amount of contributions allowed under the elective deferral limit and make catch-up contributions have the opportunity to contribute up to $26,000 (combined total of traditional (tax-deferred) and Roth contributions) in 2020 to their TSP accounts.
The elective deferral and catch-up contribution limits apply to contributions participants make to the TSP and most other employer-sponsored defined contribution plans (e.g., 401(k), 403(a), or 403(b) plans). Participants who exceed these limits by contributing to more than one employer plan may request a refund of excess deferrals from the TSP for the amount of contributions above these limits. In January 2020, the TSP will make available Form TSP-44, Request for Refund of Excess Employee Contributions, and the fact sheet Annual Limit on Elective Deferrals. The TSP must receive a participant’s request for a refund of 2019 excess elective deferrals no later than March 15, 2020. The TSP cannot process requests received after this date. Services should refer affected participants to the TSP website for more information.
The IRC § 415(c) annual addition limit for 2020 is $57,000. This limit applies to the total amount of contributions made on behalf of a participant in a calendar year. It primarily affects participants who contribute to their uniformed services TSP account while deployed in a designated combat zone. When this occurs, the member makes contributions from tax-exempt pay. These contributions are not limited by the elective deferral limit, but instead count only toward the annual addition limit.
Service Automatic (1%) contributions; and
NOTE: Although traditional (tax-deferred) contributions and Roth contributions count toward the annual addition limit, they may not exceed the elective deferral limit ($19,500 for 2020) for the year in which they are made.
19-U-11
TSP Bulletin 18-U-3, 2019 TSP Contribution Limits, dated 12/11/2018