What is the Qualified Retirement Savings Contributions Credit (“Saver’s Credit”)?​

The Saver’s Credit is a federal tax credit designed to encourage lower- and moderate-income taxpayers to save for retirement
 
Highlights
  • Reduces your tax liability based on contributions to eligible retirement accounts
  • Credit ranges from 10% to 50% of qualifying contributions depending on income
  • Maximum contribution eligible for the credit is $2,000 per taxpayer ($4,000 if married filing jointly)
 
Who qualifies for the Saver’s Credit?
  • Must be age 18 or older
  • Cannot be claimed as a dependent on another taxpayer’s return
  • Cannot be a full-time student during the tax year
  • Must have made eligible retirement contributions
  • Must meet income limits based on filing status
 
What retirement contributions qualify for the credit?
  • Contributions to a Traditional IRA or Roth IRA
  • Elective salary deferrals to a 401(k), 403(b), governmental 457(b), or SIMPLE plan
  • Voluntary employee contributions to qualified plans
  • Contributions to an ABLE account by the designated beneficiary
  • Rollover contributions do not qualify
 
What are the Adjusted Gross Income (AGI) limits for the credit (2025 tax year)?
  • Married Filing Jointly: credit phases out once AGI exceeds $76,500
  • Head of Household: credit phases out once AGI exceeds $57,375
  • Single or Married Filing Separately: credit phases out once AGI exceeds $38,250
 
How is the credit calculated?
  • Based on eligible retirement contributions up to $2,000 per person
  • Credit percentage determined by adjusted gross income (AGI)
  • Contributions may be reduced by recent retirement plan distributions received within a specific look-back period
 
Do employer contributions count toward the credit?
  • No
  • Only the taxpayer’s own contributions qualify
  • Employer matching or profit-sharing contributions are not eligible
 
Can the credit generate a refund?
  • No
  • The Saver’s Credit is nonrefundable
  • It can reduce tax liability to zero but cannot produce a refund by itself
 
Can you still claim the credit if you also deduct or exclude the contribution?
  • Yes
  • You may claim the credit even if the contribution is deductible (Traditional IRA) or made pre-tax through payroll (401(k), etc.)
  • The same contribution may produce both a deduction/exclusion and the Saver’s Credit depending on income eligibility.
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​Updated 3/6/2026