Commentary | Dec. 1, 2022
By Coast Guard Office of Civilian Human Resources
Employee contributions to the Thrift Savings Plan (TSP) are considered to be elective deferrals. The IRS elective deferral limit for 2023 is $22,500.
Employees who will be age 50 or older during 2023 may also contribute up to $7,500 in additional (catch-up) contributions if their regular contributions for the year reach the $22,500 limit.
The TSP has changed the way catch-up contributions are elected and withheld. If you are turning 50 or older, you will no longer need to make separate catch-up elections to your TSP account each year.
Employees eligible for catch-up contributions can set one contribution rate, and when they hit the annual limit, the TSP will automatically start funneling the rest of their contributions for the year into catch-up contributions.
Your election will carry over each year unless you submit a new one. You no longer have to worry about agency matching funds being suspended if you reach the maximum contribution amount prior to the end of the year. FERS employees with contributions spilling over toward the catch-up limit will continue to receive matching contributions up to 5% of their salary.
Employees may start, stop, or change catch-up contributions at any time using MyEPP. If you choose not to contribute toward the catch-up limit, you should adjust your TSP contributions accordingly.
There will be 26 paychecks reported on the 2023 Wage and Tax Statement (W-2). TSP contributions for pay period 25, 2022 will count toward the 2022 IRS elective deferral limit. TSP contributions for pay period 26, 2022 and pay periods one through 25 of 2023 will be reported on the 2023 W-2.
Employees wishing to reach the maximum regular contribution limit for 2023, in equal installments, should elect to contribute $866 per pay period starting in pay period 26, 2022. Employees wishing to contribute the maximum including catch-up contributions for 2023, in equal installments, should elect to contribute $1,154 per pay period starting in pay period 26, 2022.
For more information on TSP contribution limits for 2023, refer to the TSP website. For more information on TSP catch-up procedures, please visit here.
If you have questions, please contact your servicing Benefits Specialist.
