TSP Withdrawal Calculator

How this is calculated

Every other calculator on this site computes a pension — a payment the government owes you for service, worked out from a statutory formula. This one is different in kind. The Thrift Savings Plan is your own money in your own account, and the rules do not decide what it is worth. They decide three narrower things: whether taking it costs you a penalty, how much is held back before it reaches you, and when you stop having a choice about taking it at all.

penalty  ←  the calendar year you separated
withholding  ←  how long the payments are expected to last
required minimum  ←  the year you were born

Not one of those three is decided by your age on the day you withdraw, which is what almost everyone assumes governs all three. The projection underneath them — how long the balance survives — rests on a single assumed rate of return, which is the only figure on this page that is not a rule.

The penalty is decided by the year you separated

26 U.S.C. § 72(t)(1) adds a 10% tax to an early distribution from a qualified retirement plan. Subparagraph (2)(A)(i) lifts it at 59½. But subparagraph (2)(A)(v) lifts it far earlier for anyone who leaves an employer late in a career: it exempts distributions “made to an employee after separation from service after attainment of age 55”.

IRS Notice 87-13, Q&A-20 reads that as a calendar-year test. Separate at any point during or after the year you turn 55 and every later TSP withdrawal is free of the additional tax, at 56, at 57, at any age. Separate in December of the year you turn 54 and you have missed it permanently — a nine-month gap that decides a 10% charge on every dollar you draw for the next four and a half years. Nothing you do later reopens it.

§ 72(t)(10) moves the same test to 50 for a qualified public safety employee, and § 329 of the SECURE 2.0 Act added an alternative of 25 years of service under the plan, whichever comes first — so a federal law enforcement officer who reaches 25 years at 47 qualifies on the service test alone. That population is the same one our special provisions calculator covers, and the two exemptions are separate: 6c decides when the pension starts, § 72(t)(10) decides when the TSP is reachable without a penalty.

The exemption belongs to the plan, not to the money

This is the finding worth the page. § 72(t)(2)(A)(v) exempts distributions from a qualified employer plan. An individual retirement account is not one, and Congress wrote no equivalent exemption for IRAs. Roll your TSP balance into an IRA before you reach 59½ and the exemption you had already earned does not travel with it: the same withdrawal, by the same person, in the same year, is penalised again.

On the worked example above — separating in 2025, the year they turn 55, and drawing $2,000 a month from $600,000 — staying in the TSP costs nothing under § 72(t). Rolling the same balance to a traditional IRA costs $8,800 before 59½ arrives in 2029. The reasons people roll over are real ones — more funds, consolidated accounts, a different beneficiary structure. The rule here does not argue with any of them. It only says that doing it before 59½, when the separation exemption already covers you, has a price, and that waiting until after 59½ makes that price zero.

The 20% is decided by duration, not by amount

26 U.S.C. § 3405 runs three regimes at once, and which one you are in has nothing to do with the size of the payment:

• § 3405(c) — 20%, mandatory. An eligible rollover distribution. § 402(c)(4)(A) excludes from that definition any series of substantially equal periodic payments made “for a specified period of 10 years or more” — so a shorter series, or a single withdrawal, is one, and 20% comes off every payment however little you owe.
• § 3405(a) — as wages. A series expected to run 10 years or more, or one based on life expectancy, is a periodic payment. There is no statutory rate: it is withheld against the Form W-4P you file, exactly like salary.
• § 3405(b) — 10%, waivable. A nonperiodic distribution that is not eligible for rollover. A required minimum distribution is always in this class, which is why the mandatory 20% can never reach an RMD.

TSP applies the 10-year test at the moment you elect, by dividing your account balance by the annual installment and ignoring growth entirely. That is an administrative test, not a prediction — the calculator shows it beside how long the money actually lasts on your return assumption, and the two figures are rarely the same. The practical consequence is that a modest cut to the installment can move you across the line and hand the withholding decision back to you.

The required minimum, and why there is no age 74

26 U.S.C. § 401(a)(9) ends the choice. From your applicable age, a minimum has to come out each year whether you want the income or not. § 107 of the SECURE 2.0 Act set that age at 73, and at 75 for people attaining 74 after 2032 — a pair of tests that left the 1959 birth year belonging to neither, which the IRS proposed regulations of July 2024 resolved at 73. The result is a schedule with a gap in it:

• Born 1950 or earlier — 72.
• Born 1951 to 1959 — 73.
• Born 1960 or later — 75. Never 74.

The amount is your balance on 31 December of the previous year divided by the factor for the age you attain in the distribution year, taken from the Uniform Lifetime Table at Treas. Reg. § 1.401(a)(9)-9(c). That table is transcribed into this tool cell by cell rather than approximated, because the divisor is the entire computation: 26.5 at 73, 20.2 at 80, 12.2 at 90. The required share is 4.1% of the balance at 75 and 8.2% at 90, so it climbs for as long as you live.

It is a floor, not a schedule. If the installment you already elected is larger, nothing changes. If it is smaller, the difference is forced out and taxed as ordinary income in a year you may not have wanted it. On the worked example above the installment is comfortably below the requirement from 2045 onward, and $285,736 comes out across the projection that was never asked for. Not taking it is worse: § 4974(a) charges an excise tax of 25% of the shortfall, reduced to 10% where it is corrected inside the correction window.

Withholding is not tax

The same point our annuity tax calculator and annual leave calculator both make, and it bites hardest here. The 20% in § 3405(c) is a deposit against a liability computed on your whole year, not a settlement of it. Worse, the 10% additional tax is not withheld at all — so an early withdrawal that looks fully covered at 20% is short by the entire penalty when the return is filed. The calculator shows the withheld figure and the amount actually due as two separate lines for exactly that reason.

What this does not model

• Roth TSP. Traditional balances only. Two things about Roth are worth knowing while you are here: a qualified Roth distribution needs both age 59½ and five years since your first Roth contribution, and § 325 of the SECURE 2.0 Act removed Roth employer-plan balances from the required minimum distribution rules entirely from 2024, so a Roth TSP balance is no longer forced out at all.
• The return, which is the only assumption here. A single flat rate every year is not how a market behaves. Two accounts with the same average return and different orders of good and bad years end in very different places, and a projection of this shape cannot show that. Treat the depletion age as a comparison between choices, not a forecast.
• Inflation. Every figure is nominal. A fixed installment buys less every year it runs, which the COLA calculator puts a number on for the pension beside it — the TSP has no adjustment mechanism at all.
• The other § 72(t) exceptions. Substantially equal periodic payments under § 72(t)(2)(A)(iv), which TSP life-expectancy installments satisfy, are a genuine penalty-free route for someone who separated too early for the 55 rule — at the cost of a series that cannot be modified. Disability, medical expenses, a qualified domestic relations order and the SECURE 2.0 emergency and domestic abuse distributions are also outside the penalty and are not modelled.
• The first-year deferral.§ 401(a)(9)(C) lets the first required distribution wait until 1 April of the following year. Doing so puts two distributions in one tax year, which is usually worse; this projection takes each one in its own year.
• Other accounts. The RMD here is computed on this balance alone. IRA minimums may be aggregated across IRAs; employer plan minimums may not be, so a TSP requirement has to be satisfied from the TSP.
• State tax, the TSP life annuity, and loans. State treatment of retirement income varies widely and is left out rather than guessed. The TSP life annuity is priced by an insurer against rates that change, not by a statutory formula, so it is outside what this site is willing to compute.

Sources

• 26 U.S.C. § 72(t) — the 10% additional tax (1); the exemption at 59½ (2)(A)(i); the separation-after-55 exemption (2)(A)(v); substantially equal periodic payments (2)(A)(iv); and qualified public safety employees (10).
• 26 U.S.C. § 402(c)(4)(A) — a series of substantially equal periodic payments over 10 years or more is not an eligible rollover distribution.
• 26 U.S.C. § 3405 — periodic payments withheld as wages (a); the 10% default on nonperiodic distributions (b); and the mandatory 20% on eligible rollover distributions (c).
• 26 U.S.C. § 401(a)(9) — required minimum distributions and the required beginning date, as amended by § 107 of the SECURE 2.0 Act (Pub. L. 117-328, Div. T).
• Treas. Reg. § 1.401(a)(9)-9 — the Uniform Lifetime Table, revised effective 2022, transcribed in full into lib/tsp-withdrawal.js.
• 26 U.S.C. § 4974(a) — the excise tax on an amount not distributed, cut to 25% by § 302 of the SECURE 2.0 Act and to 10% on timely correction.
• TSP — Withdrawing From Your TSP Account — how the plan itself applies the 10-year test to installments, and the withholding that follows from it.
• IRS Publication 575 — pension and annuity income, the additional tax on early distributions, and the exceptions to it.

Last reviewed: August 2026