TSP: Uniformed Services Service Rep Announcements; 2008 Jul 02

TSP Service Representatives

Uniformed Services Announcements

July 1, 2008 — The Federal Retirement Thrift Investment Board has changed the way it is displaying the share prices of the TSP funds from two decimal places to four decimal places. This change will allow for greater precision in calculating account balances and in tracking the TSP funds to the indexes with which they are associated. More information is available in the Questions and Answers on this topic.
June 30, 2008 — We have just made it easier for participants to access their accounts on the TSP Web site. Participants can now create Custom User IDs to use in place of their 13-digit TSP account numbers to access their accounts on the Web site. To do this, they will log into Account Access using their TSP account numbers and Web passwords, and then choose “Create/Modify Custom ID” from the Account Access menu. The custom ID is interchangeable with the TSP account number on the Web site—participants can use their custom IDs OR their 13-digit TSP account numbers, along with Web passwords, any time they log into their accounts.

Note: Custom IDs cannot be used on the ThriftLine. The TSP account number (and 4-digit PIN) remain the only way to access a TSP account on the ThriftLine.
June 20, 2008 — The Federal Retirement Thrift Investment Board is changing the way it will display share prices of the TSP funds from two decimal places to four decimal places. This change will occur on July 1.
May 27, 2008 — Web Redesign Survey: The Federal Retirement Thrift Investment Board is redesigning the TSP Web site. We recently posted a web-based survey to ask individuals why they use the Web site, whether it is easy or hard to use, and what they would like to see changed or kept as is. We have concluded the survey and removed it from the TSP Web site. Thank you for your assistance in getting the word out to your service members to participate in this survey.
May 1, 2008 — Interfund Transfer Rule effective May 1, 2008. Bulletin is now available for download.
April 24, 2008 — The Agency has published a final regulation that takes effect Thursday, May 1, 2008. It will limit the number of unrestricted interfund transfer requests to two per month. After a participant has made two interfund transfers in a calendar month, the participant may make additional interfund transfers only into the G Fund until the next calendar month. For more information about this change, see the Questions and Answers on this topic. A TSP Bulletin will be issued shortly.
April 10, 2008 — The opportunity for comment on the proposed regulation ended on April 9, 2008. We are currently evaluating the comments we received. Once we reach a final decision on the approach to be taken, we will announce it to all participants via the Web site and Thriftline.
March 10, 2008 — The Federal Retirement Thrift Investment Board has issued a proposed regulation that would limit the number of interfund transfer requests to two per month. Under the proposed regulation, after a participant has made two interfund transfers in a calendar month, the participant may make additional interfund transfers only into the G Fund until the first day of the next calendar month.
As a point of clarification, the January 7^th interim regulation provided for an immediate, short-term procedure to curb frequent trading (see link below). This proposed regulation provides for a broader, system-wide solution.

For more information about frequent trading, see the Questions and Answers on the TSP Web site Home page.
Annual Participant Statements. The mailing of the new annual participant statements will begin shortly; we expect that it will continue through the end of February since we are sending 4.1 million statements. As announced in the October 2007 and January/February 2008 Highlights, the statements will provide participants with a summary of the 2007 activity in their TSP accounts as well as a number of new features including their personal rates of return, the amount of their life time contributions, and their beneficiaries of record. A copy of the leaflet, How To Read Your Annual Participant Statement, will be enclosed with the mailing to assist participants in understanding the new statements. Also, a set of Questions and Answers will be posted on the TSP home page next week which will supplement the leaflet.

Because this is a new service, we anticipate a lot of interest in the statements – particularly from participants who may not have been keeping up with their online quarterly statements. We also expect that you will get questions from participants who want to update their beneficiary information. Please remind your participants that the Designation of Beneficiary forms must be sent to the TSP; they should not be given to the agency personnel or finance offices. The latest versions of the Designation of Beneficiary forms (civilian and uniformed services) are available in Forms and Publications.

The mailing will also include a letter from the Executive Director reviewing last year’s TSP activities and discussing upcoming events as well as a copy of the January/February 2008 Highlights.
Roth IRA Transfers. The new option permitting eligible participants to transfer their TSP accounts to a Roth IRA, as well as to a traditional IRA or other eligible employer plan (like a 401(k) plan) is coming soon (probably the week of the 11th). We are posting a set of Questions and Answers on the TSP home page describing the new Roth IRA transfer, its eligibility requirements, and other information about the option. The versions of the forms, tax notices, etc., incorporating the Roth IRA transfer option will be updated in Forms and Publications and we will begin shipping them as we fill agency and service requests for materials. Remember, this option is for transfers out of the TSP. Participants cannot transfer Roth IRA funds into the TSP.
January 7, 2008 -- The Federal Retirement Thrift Investment Board has issued interim regulations that allow the Executive Director to adopt a policy setting limits on the number of interfund transfers requests. In the near term, this interim regulation allows the Executive Director to immediately address and, if necessary, restrict the activity of frequent traders, who have disrupted management of the TSP Funds and whose activity has resulted in increased costs to all participants. This interim rule is effective January 7, 2008. For more information about frequent trading, see the Questions and Answers on the TSP Web site Home page.
I.R.C. Section 402(g) Limit — The elective deferral limit for 2008 remains $15,500. This limit applies to tax-deferred employee contributions. If employee contributions are also made to a civilian TSP account, the total of the tax-deferred employee contributions cannot exceed this limit.
Catch-Up Contributions — The limit on catch-up contributions for 2008 is $5,000. Eligible employees must make new elections for catch-up contributions each calendar year.
I.R.C. Section 415(c) Limit — The limit for 2008 is $46,000. This limit applies to all TSP contributions, including tax-exempt contributions. If contributions are also made to a civilian TSP account, the total of all contributions cannot exceed this limit.
September 21, 2007 — The Federal Retirement Thrift Investment Board (FRTIB) has issued final regulations to reflect enhanced security measures, including its use of account numbers in place of Social Security numbers as the primary way of identifying participants’ TSP accounts. You can find these regulations on the FRTIB Web site at www.FRTIB.gov.
The Federal Retirement Thrift Investment Board has issued final regulations (1) to clarify that the procedures applicable to an employee who was misclassified as either CSRS or FERS also apply to an employee who elects retroactive non-appropriated fund (NAF) retirement coverage; (2) to allow a non-spouse beneficiary to transfer a death benefit payment to an inherited IRA as authorized by the Pension Protection Act of 2006; (3) to clarify that a bankruptcy court now lacks jurisdiction over a TSP loan; and (4) to address other administrative matters.
As a result of the account number announcement mailing, we are receiving calls from participants who would like to update their addresses. Please remind your service members that active participants must change their addresses through their service. We are referring these participants back to their service and reminding them that some of the services have self-service benefits systems (i.e., myPay) which will allow them to change their addresses quickly and easily.
For added security, the TSP now requires that members of the uniformed services enter a longer and more complex Web password when they log into Account Access. If they already had a TSP account when the new Web passwords went into effect, they will be prompted to either create their own password or request a computer-generated password. New TSP participants will receive their Web passwords in the mail after the TSP receives their first contribution. Passwords will not work with the ThriftLine. To access their account by telephone via the ThriftLine, members of the uniformed services will continue to use their TSP Personal Identification Number (PIN).

We are updating all of the publications with the new Web password information. These are being posted on this Web site and you will receive the new versions when you order the publications.
A new chart, "Uniformed Services Elective Deferral, Section 415(c) and Catch-Up Contribution Limits for 2002-2007," is now available under Historical Information. To review the chart, click here.
The leaflet "You're here for us today...We'll be there for you tomorrow" explains the advantages of contributing to the TSP to members of the uniformed services who are serving our country. To review the leaflet, please click here.
The Agency is announcing the transition of its agency technical services and death benefits and legal processing activities from the National Finance Center in New Orleans, LA, to SI International, Inc. in Fair Oaks, VA. Please see TSP Bulletins 06-2 (Civilian) and 06-U-3 (Uniformed Services) for more information. In addition, we have updated this Web site's contact information and the contact information in the affected booklets and forms (e.g., the Court Order Booklet; Forms TSP-17 and TSP-U-17, Information Relating to Deceased Participant. The updated materials will also be available through the normal TSP distribution channels.
L Funds Agency and Service Training Materials — The TSP has developed a DVD for agencies and services containing training materials that they can use in introducing the Lifecycle (L) Funds to their employees and service members. Representatives wishing to order a training package should click here for the order form. Complete the form and fax it to the Education and Training staff at (202) 942-1451.
TSP Loan Default Program — On March 31, 2006, the TSP implemented the final phase of the loan default program required by the Internal Revenue Service. The TSP has mailed notices to those participants whose loans are missing two-and-a-half or more payments, notifying them that the loans have been reamoritized. Although their loan payments have not been changed, the terms of the loan have been extended and, in some cases, a balloon payment at the end of the term may be required unless additional payments are made. Click here for the memorandum to agency and service representatives regarding this project.
Annuity Program On January 17, 2006, the Federal Retirement Thrift Investment Board selected Metropolitan Life Insurance Company (MetLife) to continue to provide annuities to participants of the Thrift Savings Plan (TSP). Click here for the memorandum to TSP coordinators regarding the changes to the annuity program.
Click here for information regarding the Phishing Scam.
Employee Contributions — Beginning in 2006, there were no longer any percentage limits on employee contributions to the TSP. TSP contributions are limited only by the restrictions imposed by the Internal Revenue Code. See TSP Bulletin 05-U-8.