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**HOT** Can Thrift Savings Plan Be Used As An Asset?

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Filed: Timeline

Can someone tell me if they've had any experience documenting their TSP balances to support their shortfall of the poverty levels? I'm showing that I need a total of $40000 more but I have $101,000 in my TSP account. I've read that when documenting bank accounts that you have to have a letter from the financial institute showing the date the account was opened, all deposits and withdrawals for a 12 month period, and the balances. Will TSP have to be documented the same way?

I've searched and searched and have not found any similar question. I know the asset must be able to be liquified within one year and I know this can be done with TSP accounts, of course with a 10% penalty, but there would still be more than enough to cover the $40K shortfall.

Can you guys please weigh in on this question?

Thank you all for your help in advance!

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If the asset can be converted into cash within one year without considerable hardship or financial harm to you, then you would be able to use this. You only have to meet 3x the difference if you are a USC petitioning a spouse or minor child and 5x the difference for others.

So if you need to make let's say $20k a year, but only make $15k, you have a $5k difference. Therefore, you would need to have at least $15k in assets (3x) or $25k in assets (5x).

$101k is about $33k if going by the 3x rule, and about $20k if going by the 5x rule.

So to sum up, it doesn't matter what kind of asset it is, as long as it can be converted into cash within one year without hardship.


This does not constitute legal advice.

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Filed: Timeline

If the asset can be converted into cash within one year without considerable hardship or financial harm to you, then you would be able to use this. You only have to meet 3x the difference if you are a USC petitioning a spouse or minor child and 5x the difference for others.

So if you need to make let's say $20k a year, but only make $15k, you have a $5k difference. Therefore, you would need to have at least $15k in assets (3x) or $25k in assets (5x).

$101k is about $33k if going by the 3x rule, and about $20k if going by the 5x rule.

So to sum up, it doesn't matter what kind of asset it is, as long as it can be converted into cash within one year without hardship.

Thanks for the review Ian. Now, I wonder what defines "considerable hardship or financial harm"? Withdrawing $40K will incur one a cost of 10% or $4000 in this scenario. Then a penalty of 20% if not repaid prior to filing your taxes for that particular year when the funds were withdrawn. Of course, since I have $101K that will leave plenty to pay any penalties incurred in the event I'd have to take such actions.

Has anyone obtained documentation from TSP to prove to USCIS that you meet the poverty levels? If so, what documentation did you obtain?

Does anyone find it odd that their FAM does not mention IRAs, 401Ks, TSP in their manual?

Thanks again Ian for your valuable input!

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Filed: Timeline

You actually don't have to unless you wish to take it as a loan. But at a minimum it will cost you a 10% penalty if you're under 59 1/2 and the standard 20% federal tax if you don't repay it. I'm hoping TSP will be considered an asset as you can convert it within about 10 days. Any other thoughts?

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Ok, I see. I thought it was some sort of loan. If it's regular cold hard cash, it's ok. The tax isn't a penalty, it's a tax so it won't be counted against the amount you take out. The 10% is a penalty, but not enough to be considered considerable financial hardship.

Also you don't have to actually withdraw the amount, you just have to prove that you have this asset. Therefore, you need a letter from whatever company or bank where you have this account and this balance stating that you have these funds. It could be statements as well, I would have both a letter and statements just in case.


This does not constitute legal advice.

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Filed: Timeline

Ok, I see. I thought it was some sort of loan. If it's regular cold hard cash, it's ok. The tax isn't a penalty, it's a tax so it won't be counted against the amount you take out. The 10% is a penalty, but not enough to be considered considerable financial hardship.

Also you don't have to actually withdraw the amount, you just have to prove that you have this asset. Therefore, you need a letter from whatever company or bank where you have this account and this balance stating that you have these funds. It could be statements as well, I would have both a letter and statements just in case.

Ian, thanks for the input. Would like to see if others had to go through the same ordeal.

NBF

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