The Federal Retirement Thrift Investment Board recently announced the 2009 limits for TSP Contributions, loan interest rates, and other up-to-date TSP info at this site. The elective deferral limit for 2009 is $16,500. Elective deferrals are the tax-deferred amounts that you choose to contribute to the plan instead of receiving as pay. In addition, members serving in designed tax-free combat zones can contribute up to a total of $49,000 in 2009. Wow – that is a lot of money. However, there are big benefits to contributing heavily to your TSP while deployed. The money won't ever be taxed, because it has been earned in a tax free zone. As long as you contribute some portion of your base pay, then you can contribute up to 100% of any special pays. The explanation sounds a little complicated, but basically any money you contribute to your TSP account while you are deployed doesn't fall under the $16,500 limit because you aren't deferring any taxes. The $49,000 figure represents another IRS rule that limits total contributions to TSP, not just the ones that are deferring taxes. (I apologize if I sound redundant – it took me a while to figure it out).
If you are eligible for a civilian TSP account because you are a reservist who works for the federal government, or you leave the military during the year and then begin working for the federal government, there are some special rules that apply to your contributions. Some info about these situations can be found here,