step three. Tax Remedy for Delinquent Money: If you can’t pay back your Tsp mortgage and is declared a taxable shipping, the new Irs usually get rid of the fresh unpaid harmony since money, subject to typical taxation and maybe a supplementary 10% very early withdrawal punishment.

cuatro. Effect on Old age Savings: Credit from the Tsp account setting the bucks withdrawn is no extended earning financing output. Through the years, this may rather slow down the amount of money you may have during the senior years, affecting your enough time-label monetary protection.