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The TSP May Add A Tax-Free Roth Option

I don't think many employers have added the Roth 401k feature.  This would be a great  benefit for retirement savers, but just a few large companies offer the new Roth 401k.   The Washington Post reported the Thrift Savings Plan (TSP) may add the Roth option.

Currently, TSP participants make tax-deferred contributions, and those savings plus any earnings are taxed upon withdrawal, usually in retirement. Contributions to Roth plans are made after taxes have been paid; those savings and their earnings are withdrawn tax-free. That makes a Roth option especially attractive to people who expect their income to rise over time, putting them in higher tax brackets.

Posted on Tuesday, May 20 by Registered CommenterWise Owl in | Comments Off