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Federal TSP tax-treatment workbench

Roth vs. Traditional TSP calculator

Compare the same current take-home cost or the same gross employee deposit—then keep tax timing, qualified Roth treatment, agency funding, and one shared investment return visible.

Step 1Choose the comparison frame

Equal take-home cost is the cleaner tax-rate comparison. Equal gross shows the different paycheck sacrifice explicitly.

The same gross employee dollars enter both scenarios; the current cost will differ.

Used as a compensation cap and, when selected, for the FERS agency estimate.

Step 2Set the 2026 payroll facts

Sets the exact $24,500, $32,500, or $35,750 employee limit.

The model spreads pay and deposits evenly; choose your payroll count.

Choose required only for payroll-confirmed application. OPM's 2026 rule uses a strictly-over-$150,000 prior-year threshold; salary alone is not enough.

Both employee source types can earn matching; every modeled agency dollar enters Traditional.

Step 3Set the time and market assumptions

The entered 2026 pattern repeats for this many years; it is not future-limit compliance.

Must be at least the contribution period. Balances grow after contributions stop.

One nominal effective rate applies to both sources. Range: -50% through 30%.

Used only for the today-dollar display; it never changes nominal balances or tax.

Step 4Keep current tax and withdrawal tax separate

Applied only to Traditional employee dollars as an income-tax deferral.

Enter 0 if your jurisdiction does not recognize the exclusion or you want federal-only.

Use an effective planning rate for Traditional withdrawals—not a promised future bracket.

Enter 0 for a federal-only comparison. No state law is looked up automatically.

Full Roth earnings are treated as income-tax-free only after the five-tax-year rule plus age 59½, disability, or death. Unsure cases belong in the withdrawal-tax tool.

Ready

Compare the tax timing—not two imaginary investments.

Both scenarios use one return and one payroll cadence. Current paycheck cost, agency dollars, source balances, and modeled withdrawal tax stay separate.

  1. 01Choose equal take-home cost or equal employee deposits.
  2. 02Confirm payroll's 2026 Roth catch-up treatment.
  3. 03Pressure-test the result across return and future-tax assumptions.

Calculations stay in this browser. This page makes no payroll, IRS, TSP, OPM, tax-provider, or FedUp data-platform request.

Method

Compare tax treatment without changing the investment

Traditional and Roth TSP money can use the same funds. The meaningful variables here are contribution capacity, current income-tax cost, source allocation, agency funding, qualification, and future tax—not a made-up Roth return versus Traditional return.

  1. 01

    Choose a fair comparison

    Equal take-home cost grosses up the Traditional-first deposit until its modeled paycheck cost matches Roth exactly. Equal gross deposits instead keeps the contribution equal and displays the larger Roth cash sacrifice.

  2. 02

    Keep tax moments separate

    Current marginal income-tax savings apply only to Traditional employee dollars. A separate effective rate applies to the modeled Traditional balance at withdrawal; Social Security and Medicare savings are never invented.

  3. 03

    Follow TSP source rules

    Both employee tax types can earn matching, but agency automatic and matching dollars stay Traditional. A payroll-confirmed 2026 Roth catch-up requirement moves only employee dollars above $24,500 to Roth.

  4. 04

    Pressure-test, do not predict

    One shared return applies to both sources. The nine-cell grid changes return and future tax while the ledger keeps contributions, agency dollars, growth, and source balances auditable.

2026 rule boundary

Catch-up dollars need a payroll answer

The calculator never substitutes current salary or AGI for payroll's Roth catch-up determination. That is especially important in 2026, when TSP operational guidance and the IRS regulations' general applicability dates must be kept distinct.

Under age 50
$24,500
2026 combined Traditional plus Roth employee limit.
Age 50+ except 60–63
$32,500
$24,500 plus the $8,000 catch-up.
Ages 60–63
$35,750
$24,500 plus the $11,250 enhanced catch-up.
2025 wage threshold
> $150,000
Strictly greater than; exactly $150,000 does not trigger OPM's 2026 rule.

Included

What the calculator can keep exact

  • Equal current take-home cost and equal gross employee-deposit views
  • Exact 2026 employee limits for under 50, age 50+, and ages 60–63
  • User-confirmed 2026 mandatory Roth catch-up treatment
  • Current federal and optional state/local marginal income-tax assumptions
  • Future federal and optional state/local effective withdrawal-tax assumptions
  • Qualified Roth distribution planning confirmation
  • Optional FERS 1% automatic and pay-period matching estimate
  • Traditional/Roth source balances, inflation-adjusted view, sensitivity, ledger, and CSV

Excluded

Where a planning model must stop

  • A personal tax return, filing status, brackets, deductions, credits, AMT, withholding, refund, or FICA-saving calculation
  • Nonqualified Roth earnings tax, an additional 10% tax, or an actual TSP withdrawal election
  • Existing balances, Roth in-plan conversion tax, recharacterization, rollover, RMD, loan, or annuity analysis
  • Outside-plan deferral aggregation, unusual Internal Revenue Code section 415 coordination, or remaining-limit adjudication
  • Uniformed-services/BRS timing, combat-zone tax-exempt contributions, or agency vesting/forfeiture decisions
  • Future IRS limits, payroll thresholds, wage growth, tax law, fund performance, or market sequence forecasts
  • A fund recommendation, tax advice, investment advice, or universal Traditional-versus-Roth winner

Primary sources

Rules from IRS, TSP, and OPM—not a tax-data vendor

Statutory limits and TSP source rules are versioned locally. Personal tax rates, payroll treatment, return, inflation, and timing remain explicit inputs because no government feed can know them safely.

Rules last reviewed 2026-07-22. Refresh before each new contribution year.

IRS Notice 2025-67Official 2026 $24,500 elective-deferral limit, $8,000 ordinary catch-up, $11,250 age-60–63 catch-up, and $150,000 prior-year Roth-catch-up threshold.OPM Benefits Administration Letter 26-101Federal workforce implementation: the 2026 catch-up rule uses a strictly-more-than-$150,000 prior-year threshold and payroll handles the source switch.TSP contribution limitsCurrent TSP annual employee-limit, catch-up, and contribution-cap context.TSP contribution typesAgency Automatic 1% and matching: dollar-for-dollar on the first 3% and 50 cents per dollar on the next 2%, calculated by pay period.TSP Traditional and Roth contributionsEmployee tax treatment, match eligibility, combined limits, and the rule that agency/service contributions enter the Traditional balance.IRS designated Roth account guidanceCurrent taxation, qualified five-tax-year plus age 59½/disability/death conditions, and nonqualified-distribution boundary.IRS retirement-plan contribution withholding FAQTraditional deferrals reduce current federal income-tax wages but do not reduce Social Security or Medicare wages.TSP Roth in-plan conversionsThe 2026 conversion option is taxable, one-way, and distinct from changing future payroll contribution elections.

Questions

Roth TSP calculator FAQs

Is Roth or Traditional TSP better?

Neither is universally better. The comparison depends on current income-tax cost, future effective tax on Traditional withdrawals, contribution amount, qualified Roth status, time, return, and agency matching. The calculator reports only what is higher under the assumptions entered.

Why compare the same take-home cost?

A $10,000 Roth contribution costs more current spendable pay than a $10,000 Traditional contribution because Roth is currently taxed. Equal-cost mode lets Traditional contribute more until the two paycheck costs match exactly, subject to basic pay and the 2026 employee limit.

Do Traditional TSP contributions reduce Social Security and Medicare tax?

No. The calculator applies current savings only to the federal and state/local income-tax assumptions entered. It does not reduce Social Security or Medicare taxes for either contribution type.

What is the 2026 Roth TSP catch-up rule?

For a catch-up-eligible participant whose payroll determines the rule applies, employee contributions above the regular $24,500 limit must be Roth. OPM says the 2026 prior-year threshold is strictly more than $150,000; exactly $150,000 does not trigger it. The tool asks for payroll's determination instead of inferring it from salary.

Are FERS agency matching contributions Roth?

No. Roth and Traditional employee contributions are both match-eligible, but TSP says Agency Automatic 1% and matching contributions go into the Traditional balance. The calculator therefore applies the future Traditional tax assumption to agency money.

When is a Roth TSP distribution qualified?

The designated Roth account generally must satisfy the five-tax-year period and the distribution must occur after age 59½, disability, or death. The tool requires a qualified-distribution planning confirmation before treating Roth earnings as income-tax-free.

Does this calculator include a Roth in-plan conversion?

No. TSP's 2026 in-plan conversion moves eligible existing Traditional money to Roth, generally creates current taxable income, and cannot be reversed. This page compares future payroll contributions only.

Does FedUp upload my salary or tax assumptions?

No. The model runs in your browser. It makes no payroll, IRS, TSP, OPM, tax-provider, or FedUp data-platform request and does not transmit or store the entries.

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