If you are a member of the uniformed services or work for the Federal Government you are eligible to sign up for a Thrift Savings Plan (“TSP”). A TSP is a retirement savings plan similar to a 401(k), and it often supplements other retirement plans such as Federal Employee Retirement System (FERS) or your military retirement. Even though it is similar to a regular 401(k) it is managed by the Federal Thrift Investment Board, which is an independent government agency, as opposed to a private financial services company.
When you retire your TSP is treated the same as a 401(k). During your working years you place a portion of your pretax earnings into your TSP account and those funds are taxed when removed post retirement. Because a TSP is similar to a 401(k) they are treated in the same way during a divorce. The community portion of the TSP (the amount accrued during marriage), are divided pursuant to a specially prepared order. A Thrift Savings Plan does not fall under the Employees Retirement Income Security Act (“ERISA”), rather the order must meet different requirements under Federal Law (5 United States Code sections 8435(c) and 8467, and 5 Code of Federal Regulations part 1653, subpart A).
However, for purposes of your dissolution, a TSP account is a community property asset that will be divided by the court. Please contact us if you are a member of the military and considering a modification of child or spousal support, divorce from your spouse, a legal separation, or have questions regarding child custody and visitation. Nancy J. Bickford is the only lawyer in San Diego County representing clients in divorces, who is a Certified Family Law Specialist (CFLS) and who is actively licensed as a Certified Public Accountant (CPA). Don’t settle for less when determining your rights. Call 858-793-8884 in Del Mar, Carmel Valley, North County or San Diego.