Form TSP-3 Designation of Beneficiary: Filing, Changes, and Payouts

Form TSP-3, the Thrift Savings Plan Designation of Beneficiary, tells the TSP who should receive your account when you die. You can file it online through your My Account portal at tsp.gov or mail a paper form to the TSP record keeper in Birmingham, Alabama. Whatever you put on that designation controls the payout — a will, a divorce decree, or a separation agreement cannot override it.¹

Online or Paper

The TSP prefers that you designate beneficiaries online. Log in to My Account, add or change beneficiaries, and you’re done in a few minutes with no printing, signing, or mailing.² The online path avoids the errors that get paper forms rejected: mismatched dates, altered fields, missing witness signatures.

The paper TSP-3 still exists and is available through agency personnel offices, though copies posted on various federal websites are often out of date. If you go the paper route, the TSP record keeper must receive your signed form within 365 calendar days of the date you signed it. A form that lands after that window is void.³

What to Have Ready Before You File

For each person you plan to name, you need full legal name, Social Security number, date of birth, and current mailing address. For a trust, estate, or organization, you’ll enter the trustee’s, executor’s, or contact’s identifying information instead.²

A few rules govern how you split the account:

You can name up to 20 beneficiaries total across primary and contingent tiers.³
Primary beneficiaries receive the balance first. Contingent beneficiaries receive it only if every primary beneficiary has died before you.
Shares are whole percentages, not dollar amounts, and the shares within each tier must add up to exactly 100%.⁴
You cannot use different beneficiaries for your traditional and Roth balances. One designation covers the entire account.

Two TSP Rules That Catch People Off Guard

Your Spouse Does Not Have to Consent

Unlike private-sector 401(k) plans governed by ERISA, the TSP does not require your spouse’s signature or knowledge to name someone else as your beneficiary. You can name a friend, sibling, or charity, and your spouse has no right through the TSP to override that choice.³

Divorce Does Not Revoke Your Designation

This is the most consequential mistake TSP participants make. If you named your spouse and later divorce, the TSP will pay that ex-spouse when you die. It does not matter what the divorce decree says, whether your ex signed away rights to the account, or whether you remarried. Federal law requires the TSP to honor the designation on file.⁵ A will cannot fix this either.³ Update the designation as soon as your divorce is final.

The same logic runs the other way. The TSP does not automatically add a new spouse, a newborn child, or anyone else. Review your designation after every major life event.

Filling Out and Signing the Paper Form

Complete every field clearly. Do not cross out entries, strike through names, or use correction fluid. A form with substantive alterations, whited-out fields, or scratched-out shares will be rejected. If you make a mistake, start over on a clean form.⁶

The paper form requires at least one witness. The witness must be 21 or older and cannot be someone you named as a beneficiary. If the only beneficiary you named also served as your witness, the whole designation is invalid. If a witness is one of several named beneficiaries, that witness forfeits their share, and it’s redistributed proportionally among the others.³ You must either sign in front of the witness or acknowledge your existing signature to them; a witness cannot attest to a signature they never saw or had confirmed.

Sign and date every page on the same date.⁷ The witness signs and dates after you do. The 365-day clock starts on your signature date.⁸

Where to Send the Paper Form

Mail the completed TSP-3 directly to the record keeper, not to your agency or service branch:

Thrift Savings Plan
P.O. Box 385021
Birmingham, AL 35238⁶

Once processed, the designation appears in your online account profile. Keep a signed copy for your own records in case anyone ever questions what you filed.

Changing or Revoking What’s on File

A new designation automatically replaces the previous one. There is no separate cancellation form. Log in to My Account and submit a new designation, or mail a new paper TSP-3. If you want to erase your designations entirely and let the statutory order of precedence control the payout, you can revoke through My Account.¹

Naming a Trust, Estate, or Organization

You can name a trust, your estate, or another organization instead of, or alongside, individuals. On the form, you’ll enter the trustee’s or executor’s identifying information rather than a Social Security number and date of birth.² A trust can be useful when your intended recipients are minors, have special needs, or you want to stagger distributions.

The tradeoff is tax flexibility. A surviving spouse named directly can keep the money in a TSP beneficiary participant account indefinitely; a trust cannot. If you’re considering this route, talk with an estate planning attorney who understands federal retirement benefits before filing.

If You Never File a TSP-3

Without a valid designation on file, the TSP pays your account under a statutory order of precedence set by federal law and TSP regulations.⁹ The account goes to the first category on this list with a living person:

Surviving spouse (receives the entire account).
Children, in equal shares; descendants of a deceased child inherit that child’s share by representation.
Parents, in equal shares, or the surviving parent alone.
The duly appointed executor or administrator of your estate.
Next of kin under the laws of the state where you lived.

For this order, “child” means a natural or adopted child. Stepchildren you have not legally adopted don’t qualify, and stepparents who didn’t adopt you don’t count as parents.¹⁰ The hierarchy ignores promises, closeness, and need. A TSP-3 is the only way to change it.

What Your Beneficiaries Actually Receive

Spouse Beneficiaries

A surviving spouse gets a beneficiary participant account opened in their own name within the TSP. The money stays invested in the funds you chose, and moving the balance into the new account is not a taxable event.¹¹ Your spouse can keep the money in the TSP, take partial or full withdrawals, or roll the balance into their own IRA.

Non-Spouse Beneficiaries

A non-spouse beneficiary cannot stay in the TSP long-term.¹² They can request a direct transfer of the inherited balance into an inherited IRA (traditional to traditional, Roth to Roth) to preserve tax deferral. If they take no action within 90 days, the TSP issues a lump-sum payment, which triggers immediate income tax on the traditional portion.

Tax Treatment

Traditional TSP balances are taxed as ordinary income when distributed to any beneficiary. Roth TSP contributions come out tax-free because you already paid tax on them. Roth earnings are also tax-free if five years have passed since January 1 of the year you made your first Roth TSP contribution; your death satisfies the second IRS requirement automatically. If the five-year requirement isn’t met, only the earnings portion is taxable.¹³

1
Thrift Savings Plan. Designating Beneficiaries
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Thrift Savings Plan. Forms and Resources
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eCFR. 5 CFR 1651.3 – Designation of Beneficiary
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Thrift Savings Plan. TSP-3 Thrift Savings Plan Designation of Beneficiary Form
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Thrift Savings Plan. Designation of Beneficiary
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Thrift Savings Plan. Form TSP-3 – Designation of Beneficiary
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Thrift Savings Plan. Bulletin 10-9
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Thrift Savings Plan. Thrift Savings Plan Death Benefits
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eCFR. 5 CFR 1651.2
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Office of the Law Revision Counsel. 5 USC 8424 – Lump-Sum Benefits; Designation of Beneficiary; Order of Precedence
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Thrift Savings Plan. Beneficiary Distributions
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Thrift Savings Plan. A Guide for Beneficiary Participants
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Thrift Savings Plan. Thrift Savings Plan Taxes