A:

The saver's tax credit is a non-refundable tax credit available to eligible taxpayers in the U.S. who make contributions to their employer-sponsored 401(k), 403(b), SIMPLE, SEP or governmental 457 plan and/or make contributions to their Traditional and/or Roth IRAs. The saver's tax credit is claimed when you file your tax return for the year.

If your tax return is prepared by a professional, remind him or her that you are eligible for the credit and that he or she must file IRS Form 8880, which is available at the IRS website. If you file your own return, you should complete the form and attach it to your tax return. The credit amount is indicated on the line labeled "retirement savings contributions credit", in the "tax and credits" section of your tax return.

To learn more about taxation and retirement plans, read The Saver's Tax Credit: An Added Incentive To Fund Your Plan, Avoiding IRS Penalties on Your IRA Assets and Retirement Plan Tax Forms You May Need to File - Part 1.


This question was answered by Denise Appleby
(Contact Denise)

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