TSP Beneficiary Participant Account: What Surviving Spouses Need to Know
What a Beneficiary Participant Account Is
When the TSP processes a death benefit claim and the designated beneficiary is the surviving spouse, the default action is not an immediate cash payout. Instead, the TSP creates a Beneficiary Participant Account (BPA) — a separate account in the surviving spouse's name that inherits the deceased participant's balance.
The BPA preserves the tax-deferred status of the funds. No distribution is forced. The surviving spouse can manage the account through tsp.gov, choose among the same fund options (G, F, C, S, I, and L funds), and make interfund transfers.
The minimum balance for a BPA is $200. Below that, the TSP distributes the balance directly.
What You Can Do With a BPA
Keep It in the TSP
The most straightforward option. The BPA remains invested in whichever funds the deceased participant had selected, or the surviving spouse can reallocate. The TSP's G, F, C, S, I, and L funds remain available in the BPA. TSP reported an average total expense ratio of 0.039% in 2024, about $0.39 per $1,000 invested per year.
The BPA does not receive new contributions (there is no payroll to feed it), but it compounds tax-deferred until you withdraw.
Roll It Over to an IRA
The surviving spouse can directly roll over the traditional balance to a traditional IRA or eligible employer plan, and the Roth balance to a Roth IRA or eligible designated Roth account. These rollovers maintain the respective tax treatment while opening access to investments beyond the TSP funds.
A Roth conversion is also possible: roll the traditional TSP balance into a Roth IRA (or convert within an IRA), pay income tax on the converted amount, and the funds grow tax-free thereafter.
Take a Distribution
The surviving spouse can request a partial or full withdrawal at any time. Distributions from a traditional TSP BPA are taxed as ordinary income. There is no 10% early withdrawal penalty on death benefit distributions, regardless of the surviving spouse's age.
The Roth portion of the BPA is tax-free when distributed as a qualified distribution: the five-taxable-year period begins on January 1 of the year the participant first made designated Roth contributions to the TSP, and the participant's death satisfies the second qualification rule. If the five-year period was not met, distributed earnings may be taxable.
Required Minimum Distributions
Required minimum distributions apply under the rules that fit the participant's and surviving spouse's circumstances. Confirm the applicable schedule and amount with TSP before deciding when to withdraw.
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Non-Spouse Beneficiaries Get Different Rules
Adult children, siblings, parents, trusts, and estates cannot open a BPA. An individual non-spouse beneficiary who receives a direct distribution has 20% federal withholding on the taxable amount; a non-spouse designated beneficiary may instead make a direct trustee-to-trustee transfer to an Inherited IRA.
Most non-spouse designated beneficiaries who use an Inherited IRA must distribute the full balance by December 31 of the tenth year after the participant's death. Annual RMDs may also apply during years 1 through 9 if the participant died after their required beginning date. Different schedules apply to eligible designated beneficiaries, such as a minor child, a disabled or chronically ill beneficiary, or an individual no more than 10 years younger than the participant; trusts and estates also have separate rules.
How the BPA Gets Created
The process starts when the surviving spouse reports the death through the TSP Life Events Hub. After TSP reviews the required documentation and identifies the beneficiary (from Form TSP-3, or the statutory order of precedence if no TSP-3 was filed), the BPA is established automatically.
The surviving spouse receives a new TSP account number and can create a login at tsp.gov. Use the Survivor Portal for current claim steps and status.
If you are managing the TSP claim alongside the FERS death benefit, FEGLI life insurance, unpaid compensation, and the other federal benefit channels, the Federal Employee Death Benefits Claims Guide coordinates every filing deadline and form in sequence.
Get Your Free Federal Employee Death — First 30 Days Claims Checklist
Download the Federal Employee Death — First 30 Days Claims Checklist — a printable guide with checklists, scripts, and action plans you can start using today.