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Slotkin co-sponsors bill to allow furloughed workers 401(k) access

January 23, 2019
<p>Sen. Debbie Stabenow, D-Michigan, swears in Rep. Elissa Slotkin, D-Michigan, at a local swearing in ceremony on Jan. 13, 2019.&nbsp;</p>

Sen. Debbie Stabenow, D-Michigan, swears in Rep. Elissa Slotkin, D-Michigan, at a local swearing in ceremony on Jan. 13, 2019. 

Photo by S. F. McGlone | The State News

U.S. Rep. Elissa Slotkin, D-Holly, is co-sponsoring a bill to allow federal workers to withdraw funds from their retirement plans without being penalized.

With the federal government's record-setting partial shutdown now in its second month, more than 800,000 federal workers are not receiving paychecks. 

The Shutdown Relief Act, introduced by Rep. Elaine Luria, a Democrat from Virginia, and co-sponsored by 11 other representatives, aims to provide employees some form of income until the government reopens.

Under current law, federal workers under the age of 59 and a half may withdraw money from their 401(k) plans if they prove financial hardship or take out the funds as a loan. Workers are charged a 10 percent early withdrawal fee for tapping into the funds using a hardship claim.

The legislation would allow employees to withdraw up to the amount of their unpaid salary without penalty, if the funds are returned to the account within 180 days.

“As a former federal employee myself for 14 years, I’m proud to sign on as an original co-sponsor of the bipartisan Shutdown Relief Act, which would ease the burden on public servants who work every day to put country over party, and through no fault of their own are struggling to make ends meet during the shutdown,” Slotkin said in a statement.

At her local swearing-in ceremony, Slotkin said she worked for the Department of Defense during the 2013 shutdown and was familiar with the strain created by a lack of income.

Since taking office earlier this month, Slotkin has vocally supported ending the shutdown for federal workers' sake, and has publicly donated her paychecks in solidarity. Slotkin has also backed legislation to fund the U.S. Coast Guard during the shutdown.

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