It’s Tax Time! Be sure to talk to your tax person about the Retirement Savings Contributions Credit (Saver’s Credit). You may be able to take a tax credit for making eligible contributions to your IRA or employer-sponsored retirement plan.
Who’s eligible for the credit?
You’re eligible for the credit if you’re:
- Age 18 or older;
- Not a full-time student; and
- Not claimed as a dependent on another person’s return.
Amount of the credit
The amount of the credit is 50%, 20% or 10% of your retirement plan or IRA contributions depending on your adjusted gross income (reported on your Form 1040 series return). The maximum credit amount is $2,000 ($4,000 if married filing jointly). Use the chart below to calculate your credit.
| 2018 Saver’s Credit | |||
| Credit Rate | Married Filing Jointly | Head of Household | All Other Filers* |
| 50% of your contribution | AGI* not more than $38,000 | AGI not more than $28,500 | AGI not more than $19,000 |
| 20% of your contribution | $38,001 – $41,000 | $28,501 – $30,750 | $19,001 – $20,500 |
| 10% of your contribution | $41,001 – $63,000 | $30,751 – $47,250 | $20,501 – $31,500 |
| 0% of your contribution | more than $63,000 | more than $47,250 | more than $31,500 |
*Adjusted gross income
Retirement savings eligible for the credit
The Saver’s Credit can be taken for your contributions to a traditional or Roth IRA; your 401(k), SIMPLE IRA, SARSEP, 403(b), 501(c)(18) or governmental 457(b) plan; and your voluntary after-tax employee contributions to your qualified retirement and 403(b) plans.
Rollover contributions (money that you moved from another retirement plan or IRA) aren’t eligible for the Saver’s Credit. Also, your eligible contributions may be reduced by any recent distributions you received from a retirement plan or IRA.
Source: IRS.gov