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Important Financial Deadlines for Veterans at Year-End

Veterans should pay attention to important financial deadlines at year-end to avoid financial losses and penalties. TSP contributions, FSA expenses, RMDs, and Roth conversions are crucial.

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Important Financial Deadlines for Veterans at Year-End

Veterans have key financial deadlines approaching before the end of 2025. Several important tax and savings decisions must be finalised by December 31 to avoid penalties or missed benefits. These include Roth conversions, required withdrawals, and maximising retirement contributions.

Those considering a Roth conversion must complete the transfer by December 31 for it to count toward the 2025 tax year. Moving funds from a traditional IRA or Thrift Savings Plan (TSP) to a Roth account means paying taxes now in exchange for tax-free growth later.

Veterans aged 73 and older face another critical deadline. They must take their required minimum distributions (RMDs) from traditional IRAs, TSPs, and 401(k)s by the same date. Failing to withdraw the correct amount results in a 25% penalty on the undistributed sum. Financial institutions often calculate RMDs automatically based on the previous year’s balance and IRS life expectancy tables, but veterans remain responsible for ensuring withdrawals are made on time. Contributions to the TSP must also be maximised by December 31. The 2025 limit stands at £23,500, or £31,000 for those aged 50 and older. Veterans under the Blended Retirement System who contribute at least 5% of their monthly pay secure a full 5% government match, boosting their retirement savings. Additionally, veterans enrolled in FSAFEDS must use their 2025 flexible spending account (FSA) funds before the year ends. Any unused balance at midnight on December 31 will be forfeited.

The end of 2025 brings several financial cut-offs for veterans. Completing Roth conversions, taking RMDs, maximising TSP contributions, and spending FSA funds by December 31 ensures compliance with tax rules and avoids unnecessary losses. Missing these deadlines could lead to penalties or lost savings opportunities.

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