Bills · S 2966
IN COMMITTEE· 119TH CONGRESS
Senate BillS 2966Taxation
Emergency Relief for Federal Workers Act of 2025
INTRO OCT 1· LAST ACTION OCT 1
READING
8MIN
COSPONSORS
18
READER REACTIONS0 TOTAL
NO VOTES YET · BE THE FIRST
- Introduced only
LEGISLATIVE PROGRESS
STEP 2 / 8Introduced
In Committee
Reported
Passed Senate
Passed House
Conference
To President
Became Law
WHAT THE BILL DOES
AI-writtenThis bill matters because government shutdowns have become a recurring issue, often leaving hundreds of thousands of federal employees without pay for weeks or even months. These workers still have bills to pay, and a missed paycheck can cause severe financial stress, leading to a scramble for emergency funds, taking on high-interest debt, or even facing eviction.
If this bill becomes law, it would provide a critical safety net, allowing affected federal workers to access their own retirement savings without being penalized, and with the option to restore their savings once the shutdown ends and they receive back pay. If it doesn't become law, federal workers during future shutdowns would continue to face the choice of enduring financial hardship, taking on debt, or tapping into their retirement savings with an additional 10% tax penalty and fewer flexible options, potentially doing lasting damage to their long-term financial security.
KEY PROVISIONS
4AI-extractedPROVISION 01
Waives the 10% early withdrawal tax on up to $30,000 taken from the Thrift Savings Plan by federal employees affected by a government shutdown lasting at least two weeks.
This provision removes a significant financial penalty for federal workers who need to access their retirement savings during a period of unpaid work caused by a government shutdown.
PROVISION 02
Allows federal employees affected by a shutdown to make special financial hardship withdrawals from their TSP, up to $30,000, without some of the usual restrictions on such withdrawals.
This increases flexibility and access to emergency funds for federal employees during a shutdown, making it easier for them to cover essential expenses.
PROVISION 03
Permits affected federal employees to repay these shutdown-related TSP withdrawals within 120 days after the shutdown ends, treating the repayment as a tax-free rollover.
This crucial provision allows employees to restore their retirement savings and avoid income taxes on the withdrawn amount, protecting their long-term financial health.
PROVISION 04
Directs the Thrift Savings Plan Board to create rules for making it easier for affected federal employees to take out loans from their TSP account during a government shutdown.
This offers another avenue for federal workers to access needed funds during a shutdown, providing more options beyond outright withdrawals.
SPONSORSHIP
1 + 18
D· Virginia
YRS IN OFFICE
13
BILLS LED
108
COSPONSOR BREAKDOWNBIPARTISAN · 0%
DEM 18 REP 0 IND 0
ACTION TIMELINE
2 EVENTSOCT 1
Introduced in Senate
OCT 1
Read twice and referred to the Committee on Finance.
BILL INFO
TypeSenate Bill
NumberS 2966
Congress119th
StatusIn Committee
IntroducedOct 1, 2025
Last actionOct 1, 2025
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IN COMMITTEE· 119TH CONGRESS · FINANCE COMMITTEE · INTRODUCED OCT 1, 2025
Senate BillS 2966Taxation
Emergency Relief for Federal Workers Act of 2025
INTRODUCED OCT 1, 2025· LAST ACTION OCT 1, 2025
PASSAGE CHANCES
—%
READING
8 min
COSPONSORS
18
COMPLEXITY
Moderate
