Proposed Legislation Would Allow Federal Employees to Withdraw from TSP During Shutdown

Congressman Mark Meadows (R-NC) introduced legislation this week that would allow for an “excepted employee” to make a withdrawal from their qualifying Thrift Savings Plan (TSP), without a penalty, up to the amount of money they would otherwise be receiving for their pay during a government shutdown.

Current law does not allow federal workers to make withdrawals from the TSP program under this exception. Under the proposed legislation, federal workers could make these withdrawals until the partial government shutdown ends. At that time, federal employees would be permitted to make catch-up contributions to their qualifying Thrift Savings Plans up to the amount they withdrew during a shutdown.

Meadows believes this would provide a fiscally responsible approach to making sure federal workers, who work during a government shutdown, could have access to money they’ve earned—even while Congress negotiates a funding bill.

“I’ve said repeatedly that member of Congress should not be paid during a government shutdown—but federal workers (who continue to work) should be,” Meadows said. “The hardship that government funding impasses put on members of our federal workforce should not be lost on anyone, and we in Congress should be able to find a solution that allows employees to have access to pay for the work they do. Congress should vote on this bill as soon as possible to provide federal employees the options and flexibility they need during a difficult financial situation.”

Meadows has deferred his own Congressional salary until the government reopens.