TSP hardship withdrawal rules for natural disaster victims

Following the devastating hurricanes, floods, and forest fires of 2017, the Office of Personnel Management is rapidly approving Financial Hardship In-Service Withdrawal Requests (Form TSP-76) in Thrift Savings Plans. Depending on your employment and natural disaster impact, you may qualify for a hardship payment.

The goal of these loosened approval processes is to help employees who lost their homes, modes of transportation, and even federal income due to the natural disasters of 2017. If the OPM can expedite the approval process, then employees can receive their funds faster and will get back on their feet sooner

The rapid approval process provides a window of hope for federal employees who have been setting aside money in the 401(k)-like Thrift Savings Plans through the TSP Bill, but there are still strict TSP hardship withdrawal rules for natural disaster victims. By knowing these rules and criteria, you can ensure that your application is approved quickly so you can start to rebuild your life.

What Is a TSP Hardship Withdrawal?

A TSP hardship withdrawal allows federal employees to remove funds from their Thrift Savings Plans to cover the costs of specific life events. In the case of natural disaster victims, a hardship withdrawal might cover the costs of home repairs or a car replacement. These funds, initially invested and set aside for retirement, are used to help federal employees return to normalcy in the wake of a life-derailing event.

Typically, employees that apply and qualify for a hardship withdrawal are not allowed to contribute to their TSPs for six months after the payout. FERS-covered employees will also lose any matching contributions during that six month period because there is nothing to match.

However, the TSP hardship withdrawal rules for natural disaster victims are subject to change based on the disaster. For the 2017 hurricanes and wildfires, the contribution and matching limits were lifted to encourage employees to seek help and get their lives back on track.   

Understanding TSP Hardship Withdrawal Rules for Natural Disaster Victims

Knowing the requirements to request a TSP hardship withdrawal can help you fill out the form faster and have the appropriate information needed. This can expedite the submission process and help your application get approved faster. The required criteria for all TSP hardship withdrawal applicants include:  

  • The applicant must be actively employed by the federal government.
  • The applicant must complete form TSP-76.
  • The applicant must specify which natural disaster they seek payment for (and follow the deadlines allotted for qualifying payments).
  • The applicant must check “Personal Casualty Loss” box on page 2, Item 18.

Along with the required criteria, there are additional TSP hardship withdrawal rules for natural disaster victims. Applicants must either live in the covered area (with their primary residence or place of employment affected) or the applicant’s eligible family members must live and work in the covered area. Not all family members are eligible, which is why applicants must check the criteria before submitting the form.       

Submission Dates Vary By 2017 Natural Disaster

If you have been impacted by one of the major natural disasters of 2017, there is still time to submit a hardship withdrawal form. The TSP hardship withdrawal rules for natural disaster victims are specific to each crisis, so it’s important to check the deadlines based on your qualifying window.

  • Employees impacted by Hurricane Harvey must submit their forms before January 24, 2018. For these applications to qualify, the distributions must occur before January 31, 2018.
  • Employees impacted by Hurricane Irma must also submit their forms before January 24, 2018. For these applications to qualify, the distributions must also occur before January 31, 2018.
  • Employees impacted by Hurricane Maria have an extended deadline due to the severe levels of devastation to the island. They must submit their forms before March 8, 2018. For these applications to qualify, the distributions must also occur before March 15, 2018.
  • Employees impacted by the California Wildfires must also submit their forms before March 8, 2018. For these applications to qualify, payments must occur before March 15, 2018.

TSP.gov regularly updates extended deadlines and qualifying disasters for employees. All new announcements will be posted there with information for withdrawal applications.

Learn More About TSPs and Post-Disaster Financial Recovery

A short-term setback to your savings through a TSP hardship withdrawal or natural disaster impact doesn’t have to change the course of your retirement or set you back several years. When you work with a local benefits specialist, you can find ways to save and grow your retirement savings to get back on track.

Furthermore, by knowing your retirement options through the federal Thrift Savings Plan, you can prepare for a future natural disaster, even if you weren’t personally impacted in 2017. No one wants to take out a TSP hardship withdrawal, but having it as a savings option as you work toward retirement can prepare you to weather any storm, fire, or disaster. Contact us today to see how we can help you through the process. 


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