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The Thrift Financial savings Plan (TSP) just lately introduced the boundaries on the quantity that federal staff can contribute to the TSP throughout calendar yr 2026. These contribution limits embody:
(1) “Common” contributions (“elective deferrals”) that are contributions that each one staff (irrespective of their age) could make; and
(2) “Catch-up” contributions that staff aged 50 and older could make, along with the “common” contributions. Additionally, one of many provisions handed as a part of SECURE Act 2.0 will enable staff aged 60, 61, 62 or 63 to contribute a bigger TSP catch-up contribution quantity beginning in 2025.
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This column discusses how worker common contributions and catch-up contributions made to the TSP have an effect on worker company matching contributions made to the TSP account of staff lined by the Federal Workers Retirement System (FERS). As a part of the dialogue, it is going to be defined how a FERS-covered worker may lose company matching contributions if the worker had been to speed up the common contributions and catch-up contributions throughout the calendar yr. Workers ought to be aware that with respect to TSP contributions, there’s a distinction between the “go away yr” and the calendar yr. The 2026 go away yr for many federal staff begins January 11, 2026 and ends January 9, 2027. The 2026 calendar yr begins January 1, 2026 and ends December 31, 2026.
FERS-covered Worker TSP Contributions and How They Have an effect on Company Matching Contributions
All worker contributions to the TSP (“common” and “catch-up”) are made by way of payroll deductions. Conventional TSP contributions are deducted from an worker’s gross wage, earlier than federal and state revenue taxes are deducted. All Roth TSP contributions are deducted from an worker’s after-taxed wage, after federal and state revenue taxes are deducted. Workers youthful than age 50 are restricted of their TSP contributions to the full quantity of their conventional TSP and Roth TSP common contributions made throughout the calendar yr. Workers aged 50 and older are restricted of their TSP contributions (“common” and “catch-up”) to the full quantity of their conventional TSP and to the Roth TSP throughout the calendar yr.
The next are worker TSP contribution limits for calendar yr 2026:
• Workers youthful than age 50 all through 2026 are restricted to contribute to their mixed whole of conventional and Roth TSP to $24,500.
• Workers aged 50 and older all through 2026 (staff born earlier than January 1, 1977) can contribute a mixed whole to the standard TSP and the Roth TSP of $32,500 ($24,500 common contributions plus $8,000 catch-up contributions).
• Workers aged 60, 61, 62 or 63 throughout 2026 (staff born between January 1,1966 and December 31,1969 can contribute a mixed whole to the standard TSP and Roth TSP of $35,750 ($24,500 common contributions plus $11,250 catch-up contributions).
Be aware that for FERS-covered staff, an worker’s company computerized (1 p.c of the worker’s SF 50 wage) and company matching TSP contributions should not included within the $24,500, $32,500 and $35,750 limits.
When a FERS-covered worker youthful than age 50 throughout 2026 reaches the $24,500 common contribution restrict, or a FERS-covered worker aged 50 or older reaches the $32,500 restrict ($35,750, if aged 60, 61, 62, or 63 throughout 2026), the worker is prohibited from contributing to his or her TSP account for the rest of calendar yr 2025. The TSP system doesn’t enable staff to make extra contributions to the TSP as soon as they’ve reached the restrict for the calendar yr ($24,500, $32,500 or $35,750 throughout 2026, relying on the worker’s age).
These FERS-covered staff who attain the $24,500, $32,500 or $35,750 limits someday throughout 2026 (earlier than their ultimate pay date throughout calendar yr 2026), may even have their company matching contributions suspended for the rest of 2026. It’s because company matching contributions are based mostly on the quantity of worker contributions make every pay date. Particularly, for a FERS-covered worker to obtain the utmost company TSP most contributions of 4 p.c throughout calendar yr 2026, the worker should contribute at the least 5 p.c of their wage to the standard TSP, to the Roth TSP or a mix of each TSP accounts, every pay date all through calendar yr 2026. If there are not any worker contributions on a specific pay date, then there can be no company TSP matching contributions. The one company TSP contribution on behalf of the FERS-covered worker would be the computerized 1 p.c of the worker’s annual wage (the worker’s SF 50 wage). FERS-covered staff definitely don’t wish to miss any company matching contributions. The subsequent part explains how a FERS-covered worker can contribute to the TSP throughout 2026 and never miss any company matching contributions.
How FERS-covered Workers Can Maximize Company Matching Contributions Throughout 2026
The overall rule for FERS-covered staff to obtain the utmost company TSP matching contribution (4 p.c) is that the worker should contribute at the least 5 p.c of their wage to the standard TSP, to the Roth TSP, or to a mix of each TSPs every pay date. The next three worksheets – one worksheet for workers youthful than age 50 all through 2026, one worksheet for workers aged 50 to 59 and older than age 63 all through 2026, and one worksheet for federal staff aged 60, 61, 62, or 63 throughout 2026 are for use by FERS-covered staff to find out their most TSP contribution quantity every pay date to ensure that the worker to not miss any company matching contribution throughout calendar yr 2026.
Worksheet 1. FERS-covered Workers Youthful than Age 50 All through 2026
Worksheet 2. FERS-covered Workers Older than Age 50 (However Not Aged 60, 61, 62,63 throughout 2026) All through Calendar Yr 2026
Worksheet 3. FERS-covered Workers Aged 60, 61, 62 or 63 Throughout 2026
How the TSP Applies the Contribution Limits for a Federal Worker Contributing to Each a Civilian TSP Account and a Uniformed Companies TSP Account
The $24,500, $32,500 and the $35,750 TSP contribution limits throughout 2026 apply to the full contributions a federal worker makes to a civilian and a uniformed providers TSP account. The TSP will apply the suitable restrict to every account individually and won’t enable an worker to contribute a complete quantity for the yr that exceeds $24,500, $32,500 or $35,750 for the yr 2026.
The one exception to this whole contribution restrict is for contributions made to the standard TSP by a uniformed service member deployed in a chosen fight zone. These contributions coming from tax-exempt compensation don’t depend in direction of the $24,500, $32,500 or $35,750 limits. However any Roth TSP contribution made by a uniformed service member serving in a fight zone will depend in direction of the $24,500, $32,500 or $35,750 limits.
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