TSP Roth In-Plan Conversions: Rules and Limits

The Thrift Savings Plan (TSP) is the retirement savings plan for federal civilian employees and members of the uniformed services. Since January 2026, people with a traditional TSP balance can ask to convert part of it to Roth. This guide explains the rules TSP.gov publishes, what the tax bill looks like, and the points that surprise people. It is general education, not tax or legal advice. A conversion cannot be undone, so the TSP itself recommends talking to a tax advisor first.

What is a Roth in-plan conversion?

A Roth in-plan conversion moves money you already have in your traditional TSP balance into your Roth TSP balance. The money stays in the same TSP account. It does not go to an IRA or to anyone else.

Traditional and Roth balances are taxed at different times. On TSP.gov, traditional contributions are made before tax and you "pay taxes on both your contributions and earnings" when you withdraw. Roth contributions are taxed before they go into the account, and "You never have to pay taxes on the portion of your withdrawal that's made up of your Roth TSP contributions." A conversion pays the tax now, on money that would otherwise be taxed later.

The IRS describes the general idea for workplace plans: a plan "may allow" you to move amounts into your designated Roth account, and that you include the previously untaxed amount in income "in the year of transfer" (IRS: Roth account in your retirement plan).

TSP began offering conversions in late January 2026, according to TSP Bulletin 25-4 (dated November 21, 2025).

Who can convert?

According to TSP.gov (page last updated September 11, 2026), you need a vested traditional balance, and these groups can convert:

TSP.gov also says income limits do not apply and spousal consent is not required. The TSP booklet says conversions can be done "during your working years and in retirement" and does not set an age limit.

What are the amount and frequency limits?

Source: TSP.gov, Bulletin 25-4.

Bulletin 25-4 adds that you can request a dollar amount (the default) or a percentage of eligible funds. Requests made before noon Eastern are processed after market close that business day. Requests made after noon Eastern are processed after market close the next business day. People with both a civilian and a uniformed services account can make 26 conversions per account.

Which money gets converted?

You cannot pick one source. TSP.gov says the money is taken proportionally from your eligible contribution sources: traditional payroll contributions, matching contributions, vested automatic 1% contributions, and traditional rollover contributions, plus their earnings. The booklet gives an example: with $11,000 eligible, a $10,000 conversion takes $5,000 from traditional contributions, about $2,727 from matching, about $455 from the automatic 1%, and about $1,818 from a tax-deferred rollover.

Uniformed members who have tax-exempt combat-zone contributions cannot convert only those amounts. The booklet says nontaxable money converts in the same proportion as the rest, and TSP gives an example where only the taxable share of a conversion is taxable. Money in the mutual fund window cannot be converted directly. It must first be moved into TSP funds.

How is a conversion taxed?

The converted amount is added to your taxable income for the year. TSP.gov says there is no TSP fee, but state and local income taxes "may also apply, depending on where you live" (booklet TSPBK35).

Two points matter most:

• No withholding. The TSP booklet says a conversion "isn't eligible for tax withholding because money doesn't leave your account." You may need to make estimated tax payments (TSP.gov).
• Pay the tax from other money. The booklet says "You cannot use part of the amount you're converting to pay taxes."

The booklet's own example: a $50,000 conversion with all of it taxed at a 22% federal rate creates $11,000 of federal income tax, before any state or local tax. Your actual rate depends on your whole tax return, so treat that as arithmetic, not a forecast of your bill.

TSP.gov says it reports conversions on Form 1099-R. Bulletin 25-4 says the form is issued the following January with distribution code G in Box 7, and that conversions do not affect your W-2 or annual contribution limits.

Does it change anything else?

Because the amount adds to your income for the year, a large conversion can push you into a higher tax bracket (our explanation; TSP.gov also cautions about this). Whether that also affects other things, such as Medicare premiums, is outside what these TSP pages cover. See our guide to IRMAA for how income is used there, and ask a tax professional about your case.

What are the five-year rules?

TSP.gov describes two separate clocks:

1. Earnings rule. Roth earnings are tax-free only if five years have passed since January 1 of the year of your first Roth contribution or conversion, and you are 59½ or older, permanently disabled, or deceased.
2. Conversion rule. Each conversion starts its own five-year clock, beginning January 1 of the year of the conversion. Taking converted money out within that period can trigger a "10% early withdrawal penalty" unless an exception applies.

The booklet adds that if you are 59½ or older and your Roth balance is at least five years old, both rules are met. For the IRS wording on the general five-year requirement, see IRS: Roth account in your retirement plan. That page does not spell out how the 10% tax applies to rolled-over amounts, so we rely on TSP.gov for the conversion rule and have not checked it against the Internal Revenue Code.

Can you undo a conversion?

No. TSP.gov says "a Roth in-plan conversion cannot be reversed or changed." The booklet says you can cancel only until noon on the day the request is scheduled to be processed. After that it is final, even if the markets move or your tax situation turns out different from what you expected.

How does it interact with required minimum distributions?

If you are old enough to owe a required minimum distribution (RMD), TSP.gov says you must withdraw and receive the RMD for the year before converting. RMD amounts cannot be converted. The booklet says "Roth balances aren't subject to RMDs during your lifetime." For the age rules, see RMD age 73 vs 75.

What are common mistakes?

• Planning to pay the tax out of the conversion. TSP does not allow it, and there is no withholding. You need the cash elsewhere.
• Forgetting estimated taxes. With no withholding, you may need estimated payments.
• Assuming you can reverse it. You cannot after the cutoff.
• Ignoring the leave-behind rule. A payroll source with $500 or less is not eligible.
• Treating it as a transfer to an IRA. It is not. The money stays in the TSP.
• Mixing up conversions and new Roth contributions. Conversions do not count against annual contribution limits, per Bulletin 25-4, but tax is due on them.

How is this different from a Roth IRA conversion?

The ideas are alike, since both move pre-tax money to Roth and tax the amount. The account is different. Here the money stays inside the TSP with its published rules, such as the 26-per-year limit and proportional sources. For a Roth IRA, see Roth conversions on IRAs and traditional vs Roth IRA.

Where do gold and silver IRAs fit?

They are a separate subject. A Roth in-plan conversion happens inside the TSP and does not place money in an IRA or buy any metal. Moving TSP money to a self-directed IRA that can hold approved metals is a different transaction with its own steps, costs and risks. We cover it in TSP to gold IRA rollover. Before any such move, read about gold IRA fees and gold IRA risks. Neither choice is right for everyone, and we make no recommendation.

What we did not check

We did not open the IRS Internal Revenue Code or IRS regulations on in-plan conversions. We did not review how to submit a request in My Account, because the TSP pages we read do not describe the steps. We also did not check how a conversion affects state taxes in particular states, Medicare premiums, or financial aid. Rules and TSP.gov pages can change, so check the current pages before acting.

Related questions

• What happens to the five-year clock if I convert more than once? Per TSP.gov, each conversion starts its own conversion clock, while the earnings clock runs from your first Roth contribution or conversion.
• Do beneficiaries have different rules? Spouse beneficiary participants can convert, with no leave-behind requirement. Non-spouse beneficiaries cannot, per TSP.gov.
• Where can I read the primary rules? Start with the TSP booklet Roth In-Plan Conversions and the TSP page, then see our retirement planning hub.