# 119-hr-5690: Emergency Relief for Federal Contractors Act of 2025

119-hr-5690, Emergency Relief for Federal Contractors Act of 2025, is a 119th Congress bill sponsored by Rep. Subramanyam, Suhas [D-VA-10] (D-VA); status introduced; PRIA reads it as touching household money (as of 2026-04-21).

- Canonical: https://policyrisk.com/legislation/119-hr-5690
- As of: 2026-04-21
- Plain-text twin of the page above; the HTML and this file carry the same facts.

## Facts
- Bill: 119-hr-5690
- Congress: 119
- Title: Emergency Relief for Federal Contractors Act of 2025
- Status: introduced
- Introduced: 2025-10-03
- Sponsor: Rep. Subramanyam, Suhas [D-VA-10] (D-VA)
- Cosponsors: 10
- Policy area: Taxation
- Touches household money: yes
- Last recorded action: 2026-04-21

## Summary

**Creates penalty-free, tax-favored retirement withdrawals during federal government shutdowns.** This bill would let eligible individuals take special "Federal Government shutdown distributions" from employer retirement plans and treat up to $30,000 per taxable year as exempt from the usual 10% early withdrawal penalty. - Federal-funded workers: Federal contractors, certain employees of grantees or states paid in whole or in part by the Federal Government, and specified District of Columbia employees who are furloughed, on unpaid leave, or working without pay because of an appropriations lapse of at least two weeks could take these distributions. - Retirement savers: Recipients may repay distributions to an eligible retirement plan or an IRA within 3 years, repayments are treated like rollovers, and taxable amounts can be included ratably over three taxable years unless the taxpayer elects otherwise. - Plan sponsors and administrators: The bill exempts these shutdown distributions from certain trustee-to-trustee transfer and withholding rules and treats them as meeting plan distribution requirements under the tax code.

## Cosponsors (10)

- Rep. Walkinshaw, James R. [D-VA-11] (D-VA), 2025-10-03T00:00:00.000Z
- Rep. Beyer, Donald S. [D-VA-8] (D-VA), 2025-10-03T00:00:00.000Z
- Rep. McClellan, Jennifer L. [D-VA-4] (D-VA), 2025-10-03T00:00:00.000Z
- Rep. Elfreth, Sarah [D-MD-3] (D-MD), 2025-10-03T00:00:00.000Z
- Del. Norton, Eleanor Holmes [D-DC-At Large] (D-DC), 2025-10-03T00:00:00.000Z
- Rep. Swalwell, Eric [D-CA-14] (D-CA), 2025-10-03T00:00:00.000Z
- Rep. Horsford, Steven [D-NV-4] (D-NV), 2025-10-03T00:00:00.000Z
- Rep. Bell, Wesley [D-MO-1] (D-MO), 2025-10-08T00:00:00.000Z
- Rep. Larson, John B. [D-CT-1] (D-CT), 2025-10-21T00:00:00.000Z
- Rep. Vindman, Eugene Simon [D-VA-7] (D-VA), 2025-10-21T00:00:00.000Z

## Provisions PRIA read

- Tax relief on shutdown retirement withdrawals: benefit, medium. If enacted, you would not owe the extra 10% early withdrawal tax on a qualifying shutdown distribution. You could spread the taxable income evenly over three years unless you choose not to. You could pay the money back within three years and treat it like a rollover, which can fix taxes if you repa…
- Who qualifies and the $30,000 limit: mixed, high. If enacted, you would qualify only if you are a federal contractor or a worker paid with federal funds and you are furloughed, unpaid, or have reduced pay during a funding lapse. Certain DC government, DC Courts, and DC Public Defender workers would also qualify. The lapse must last at least two we…
- Easier plan processing and withholding rules: mixed, low. If enacted, shutdown distributions would count as meeting certain 401(k), 403(b), and 457 plan distribution rules. Plans would be protected when they process these payouts as shutdown distributions, as long as totals stay within the yearly limit across the employer’s related plans. These payouts wo…

## Related bills

- 119-hr-9877: Health Equity and Accountability Act of 2026
- 119-hr-7973: Momnibus Act
- 119-hr-51: Washington, D.C. Admission Act
- 119-hr-20: Richard L. Trumka Protecting the Right to Organize Act of 2025
- 119-hr-2086: Rights for the TSA Workforce Act
- 119-hr-7977: Energy Bills Relief Act

## Sources
- [119-hr-5690 on Congress.gov](https://www.congress.gov/bill/119th-congress/house-bill/5690)

## Related
- [119-hr-9877: Health Equity and Accountability Act of 2026](https://policyrisk.com/legislation/119-hr-9877)
- [119-hr-7973: Momnibus Act](https://policyrisk.com/legislation/119-hr-7973)
- [119-hr-51: Washington, D.C. Admission Act](https://policyrisk.com/legislation/119-hr-51)
- [119-hr-20: Richard L. Trumka Protecting the Right to Organize Act of 2025](https://policyrisk.com/legislation/119-hr-20)
- [119-hr-2086: Rights for the TSA Workforce Act](https://policyrisk.com/legislation/119-hr-2086)
- [119-hr-7977: Energy Bills Relief Act](https://policyrisk.com/legislation/119-hr-7977)
- [All bills in Congress](https://policyrisk.com/legislation)

Source: PRIA, https://policyrisk.com/legislation/119-hr-5690 (as of 2026-04-21).