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Thrift Savings Plan (TSP)

A retirement savings and investment plan for federal employees, similar to a 401(k) for private-sector workers.

Lapse in appropriations

A period when Congress fails to pass legislation that provides funding for government agencies and operations, often resulting in a government shutdown.

Furlough

A temporary leave of absence from work without pay, often due to a government shutdown or budget cuts.

10-percent additional tax

An extra tax penalty applied by the IRS on withdrawals from retirement accounts (like the TSP) made before age 59 and a half, on top of regular income taxes.

Financial hardship distribution

A type of withdrawal from a retirement plan allowed under specific circumstances of immediate and heavy financial need, typically subject to strict rules.

In-service withdrawals

Withdrawals from a retirement plan made while the employee is still working for the employer associated with the plan.

Eligible rollover distribution

A payment from a retirement plan that can be transferred to another retirement account (like an IRA or another qualified plan) without incurring immediate taxes or penalties.