We have received text from S. 2964: Emergency Relief for Federal Contractors Act of 2025. This bill was received on 2025-10-01, and currently has 14 cosponsors.
Here is a short summary of the bill:
The Emergency Relief for Federal Contractors Act of 2025 aims to provide specific financial relief for federal contractors and their employees during federal government shutdowns. This bill includes provisions that allow penalty-free withdrawals from retirement accounts for individuals impacted by such shutdowns. Below are the key elements of the bill:
Penalty-free Withdrawals
The bill stipulates that traditional penalties under Section 72(t) of the Internal Revenue Code will not apply to withdrawals made from retirement plans during a federal government shutdown. This means that eligible individuals can access their retirement savings without facing the standard 10% early withdrawal penalty.
Aggregate Withdrawal Limit
- Individuals can withdraw up to $30,000 during a taxable year without facing penalties.
- This amount can be adjusted for inflation in subsequent years, ensuring that it reflects the cost of living changes.
Distributor Treatment
If an individual receives a distribution that qualifies as a federal government shutdown distribution, the retirement plan that provides this distribution will not be penalized under federal law, as long as the total amount does not exceed the set withdrawal limit.
Repayment of Withdrawn Amounts
- Individuals who receive these distributions can contribute back an amount equal to what they withdrew to an eligible retirement plan within three years. This allows individuals to effectively replenish their retirement savings.
- Different treatment is specified for repayments to plans other than Individual Retirement Accounts (IRAs), which ensures correct handling under tax law.
Definitions Related to the Bill
- Federal Government Shutdown Distribution: Refers to any distribution taken by an eligible individual from their retirement plan during a lapse in federal appropriations.
- Applicable Individual: Includes federal contractors or employees who are working without pay, furloughed, or on unpaid leave because of a government shutdown.
- Federal Appropriations Lapse: Defined as any continuous period of at least two weeks during which federal funding is not available.
Income Reporting Over Time
Amounts withdrawn as federal government shutdown distributions must be reported as income over a three-year period unless the taxpayer opts out. This provision aims to decrease the immediate tax burden on individuals withdrawing funds during a shutdown.
Exemptions from Certain Rules
The bill specifies that these distributions will not be subjected to certain rollover and withholding rules that typically apply to retirement plan distributions, simplifying access for those in need during shutdown periods.
Impact Scope
The legislation mainly targets federal contractors and their employees, aiming to alleviate financial stress caused by disruptions to their pay during government shutdowns.
Relevant Companies
- None found
Senator Catherine Cortez Masto Bill Proposals
Here are some bills which have recently been proposed by Senator Catherine Cortez Masto:
- S.2964: Emergency Relief for Federal Contractors Act of 2025
- S.2884: China Military Power Transparency Act of 2025
- S.2879: Medicare Advantage Prompt Pay Act
- S.2839: Restoring American Mineral Security Act of 2025
- S.2773: WAGER Act
- S.2619: MORE DOT Grants Act
You can track bills proposed by Senator Catherine Cortez Masto on Quiver Quantitative's politician page for Cortez Masto.
Senator Catherine Cortez Masto Net Worth
Quiver Quantitative estimates that Senator Catherine Cortez Masto is worth $4.4M, as of October 17th, 2025. This is the 181st highest net worth in Congress, per our live estimates.
Cortez Masto has approximately $0 invested in publicly traded assets which Quiver is able to track live.
You can track Senator Catherine Cortez Masto's net worth on Quiver Quantitative's politician page for Cortez Masto.
This article is not financial advice. See Quiver Quantitative's disclaimers for more information.
