2015 TSP Contribution Limits

Quick on the heels of the official Cost of Living Adjustment announcement has come the new contribution limits for tax-advantaged retirement accounts.  These rules apply to both military and civilian Thrift Savings Plan (TSP) accounts, as well as civilian 401(k) and 403(b) plans.

The main number you need to know is called the elective deferral contribution limit.  This is the amount of your taxable pay that you are permitted to contribute to a TSP, 401(k) or 403(b) account.  The elective deferral contribution limit for 2015 will be $18,000.  Quick math:  if you are trying to max out your account, you will need to make monthly contributions of $1,500.

There is a catch-up contribution limit for employees aged 50 and over.  These employees are permitted to contribute an additional $6,000 to their accounts, for a total contribution of $24,000 in 2015.  Quick math:  if you are over aged 50 and trying to max out your account, you will need to make monthly contributions of $2,000.

The last limit that you need to know is the total defined contribution plan limit.  This is the total amount that any single taxpayer may have contributed to their combined TSP, 401(k) and 403(b) account, regardless of source.  This includes employer matching funds and any contributions made in a combat zone tax exclusion (CZTE) area.  The total amount that may be contributed to a taxpayer’s defined contribution plans in 2015 is $53,000.

The Saver’s Credit

Don’t forget that contributions to defined contribution plans, such as TSP, 401(k)s and 403(b)s may result in a tax credit if you are a low- or moderate-income taxpayer.  The retirement savings contribution credit, often called the saver’s credit, offers a credit for a portion of eligible contributions to tax-advantaged retirement savings accounts.

In 2015, taxpayers may be eligible for the saver’s credit if their Adjusted Gross Income (AGI) is below:

$30,500 for single taxpayers, or married taxpayers filing separately,

$45,750 for head of household taxpayers,

and $61,000 for married taxpayers who file joint returns.

As I said in my 2015 IRA contribution limits post, I know that it is hard to save, especially when you aren’t earning a lot.  From experience, let me tell you that it doesn’t always get easier as you make more money.  Life gets ever more complicated, there are often expensive children involved, and it always remains a challenge.  Saving early is a key to accumulating a healthy amount in your retirement savings account.

Just do it!

About the Author

Kate Horrell
Kate Horrell is a military financial coach, mom of four teens, and Navy spouse. She has a background in taxes and mortgage banking, and a trove of experience helping other military families with their money. Follow her on twitter @realKateHorrell.
  • Michael byrd

    When are the 2015 TSP-1 and 1C going to be available??

    • Kate

      Mr. Byrd, I don’t think that there are updated forms for each year. You should be able to make your changes with the existing forms.

  • Jet

    What is the earliest effective date to use to max out contributions in 2015 and spread them out evenly throughout the year? I intend to contribute both maximum regular TSP deductions and the maximum catch-up amount, spread out over 26 (27?) pay periods.

    Thank You

    • Kate

      Jet, I’m guessing you are a government civilian if you have 26 pay periods each year. Unfortunately, I don’t know your pay calendar. Just have 1/26 of the maximum contributed with each pay period during the calendar year. You might find some help at this blog: Retirement Savvy http://retirementsavvy.net/retirement-plans-contr

      Great job on maxing out those contributions!