This legislation aims to provide financial relief to individuals affected by federal government shutdowns by allowing them to make penalty-free withdrawals from their retirement accounts. An "applicable individual" includes federal contractors or their employees, employees of federal grantees or states whose compensation is federally reimbursed, and employees of certain District of Columbia entities, all of whom must be impacted by a federal appropriations lapse of at least two continuous weeks. These "Federal Government shutdown distributions" are exempt from the usual 10% early withdrawal penalty under Section 72(t) of the Internal Revenue Code. The aggregate amount an individual can withdraw penalty-free is limited to $30,000 per taxable year , with this amount subject to inflation adjustment after 2025. Taxpayers also have the option to elect to include the distributed income ratably over a three-taxable-year period. A key provision allows individuals to repay the amount of a Federal Government shutdown distribution to an eligible retirement plan within a three-year period from the date of receipt. If repaid, the distribution is treated as a direct rollover, effectively reversing the withdrawal for tax purposes. Retirement plans are permitted to treat these distributions as meeting their distribution requirements without violating other provisions of law, provided they adhere to the specified dollar limits.