Welcome!

News Feed Item

Many Low- to Moderate-Income Taxpayers Can Benefit From Retirement Savings Contributions Credit (Saver's Credit)

Transamerica Center for Retirement Studies® Offers Tips on How to Claim the Tax Credit

LOS ANGELES, Feb. 6, 2014 /PRNewswire/ -- Many American workers may be missing out on a valuable tax credit this year. The Internal Revenue Service's Retirement Savings Contributions Credit, also known as the Saver's Credit, is available to low- to moderate-income workers who are saving for retirement, yet just 23 percent of American workers with annual household incomes of less than $50,000 are aware of the credit, according to the 14th Annual Transamerica Retirement Survey.

(Logo:  http://photos.prnewswire.com/prnh/20140206/CG60189LOGO)

"The Saver's Credit reduces an eligible taxpayer's federal income taxes dollar for dollar, making it a meaningful incentive for low- to moderate-income individuals and households to save for retirement in a 401(k), 403(b) or IRA. Unfortunately, many may be missing out simply because they are unaware of it," said Catherine Collinson, president of nonprofit Transamerica Center for Retirement Studies®. "It's critical that we raise awareness of this important tax credit and opportunity to save for retirement so that more workers can take advantage of it and improve their retirement outlook." 

What is the Saver's Credit?

The Saver's Credit is a tax credit that may be applied to the first $2,000 of voluntary contributions an eligible worker makes to a 401(k), 403(b) or similar employer-sponsored retirement plan, or an IRA. Credits of up to $1,000 for single filers, and $2,000 for married couples, are available.

The credit is available to workers aged 18 years or older who have contributed to a company-sponsored retirement plan or IRA in the past year and meet the Adjusted Gross Income (AGI) requirements. Single filers with an adjusted income of up to $29,500 in 2013 or $30,000 in 2014 are eligible. For the head of a household, the adjusted income limit is $44,250 in 2013 or $45,000 in 2014. For those who are married and file a joint return, the adjusted income limit is $59,000 in 2013 or $60,000 in 2014. Additionally, the filer cannot be a full-time student or be claimed as a dependent on another person's tax return.

How Can Workers Claim the Saver's Credit?

"Workers who are eligible to claim the credit should use Form 1040, Form 1040A or Form 1040NR," said Collinson. "The Saver's Credit is not available on Form 1040EZ. Workers who are eligible to receive the credit are at risk of missing it if they use the wrong tax form."

Some good news is that most workers who are eligible to claim the Saver's Credit are also eligible take advantage of IRS' Free File program for taxpayers with an AGI of $58,000 or less. Fourteen commercial software companies make their tax preparation software available for free through Free File at www.irs.gov/uac/Free-File:-Do-Your-Federal-Taxes-for-Free. Certain restrictions may apply.

Workers can take the following steps to claim the credit: 

  • If you are using tax preparation software to prepare your tax return, including those offered through IRS' Free File program, use Form 1040, Form 1040A or Form 1040NR.The credit is not available with Form 1040EZ; however, the IRS has included instructions with the EZ form directing you to a different form if you choose to claim the credit. If your software has an interview process, be sure to answer questions about the Saver's Credit, Retirement Savings Contributions Credit and/or Credit for Qualified Retirement Savings Contributions.
  • If you are preparing your tax returns manually, complete Form 8880, the Credit for Qualified Retirement Savings Contributions, to determine the exact credit rate and amount. Then transfer the amount to the designated line on Form 1040, Form 1040A or 1040NR.
  • If you are using a professional tax preparer, be sure to ask about the Saver's Credit.

More information can be found on the Saver's Credit page at www.transamericacenter.org or at www.irs.gov.

About Transamerica Center for Retirement Studies®

The Transamerica Center for Retirement Studies® (TCRS) is a division of Transamerica InstituteSM, a nonprofit, private foundation. The Transamerica Institute is funded by contributions from Transamerica Life Insurance Company and its affiliates and may receive funds from unaffiliated third parties. For more information about TCRS, please refer to www.transamericacenter.org.

About the 14th Annual Transamerica Retirement Survey: Workers

This survey was conducted online within the United States by Harris Interactive on behalf of TCRS between January 21 and February 21, 2013 among 3,651 full-time and part-time workers of employers with 10 or more employees, including 1,302 with an annual household income of less than $50,000. Potential respondents were targeted based on job title and full-time or part-time status. Respondents met the following criteria: U.S. residents, age 18 or older, full-time workers or part-time workers in for-profit companies, and employer size of 10 or more. Results were weighted as needed for the number of employees at companies in each employee size range.

SOURCE Transamerica Center for Retirement Studies

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
The IoT has the potential to create a renaissance of manufacturing in the US and elsewhere. In his session at 18th Cloud Expo, Florent Solt, CTO and chief architect of Netvibes, will discuss how the expected exponential increase in the amount of data that will be processed, transported, stored, and accessed means there will be a huge demand for smart technologies to deliver it. Florent Solt is the CTO and chief architect of Netvibes. Prior to joining Netvibes in 2007, he co-founded Rift Technol...
Struggling to keep up with increasing application demand? Learn how Platform as a Service (PaaS) can streamline application development processes and make resource management easy.
If there is anything we have learned by now, is that every business paves their own unique path for releasing software- every pipeline, implementation and practices are a bit different, and DevOps comes in all shapes and sizes. Software delivery practices are often comprised of set of several complementing (or even competing) methodologies – such as leveraging Agile, DevOps and even a mix of ITIL, to create the combination that’s most suitable for your organization and that maximize your busines...
The increasing popularity of the Internet of Things necessitates that our physical and cognitive relationship with wearable technology will change rapidly in the near future. This advent means logging has become a thing of the past. Before, it was on us to track our own data, but now that data is automatically available. What does this mean for mHealth and the "connected" body? In her session at @ThingsExpo, Lisa Calkins, CEO and co-founder of Amadeus Consulting, will discuss the impact of wea...
See storage differently! Storage performance problems have only gotten worse and harder to solve as applications have become largely virtualized and moved to a cloud-based infrastructure. Storage performance in a virtualized environment is not just about IOPS, it is about how well that potential performance is guaranteed to individual VMs for these apps as the number of VMs keep going up real time. In his session at 18th Cloud Expo, Dhiraj Sehgal, in product and marketing at Tintri, will discu...
SYS-CON Events announced today that Peak 10, Inc., a national IT infrastructure and cloud services provider, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Peak 10 provides reliable, tailored data center and network services, cloud and managed services. Its solutions are designed to scale and adapt to customers’ changing business needs, enabling them to lower costs, improve performance and focus inter...
We’ve worked with dozens of early adopters across numerous industries and will debunk common misperceptions, which starts with understanding that many of the connected products we’ll use over the next 5 years are already products, they’re just not yet connected. With an IoT product, time-in-market provides much more essential feedback than ever before. Innovation comes from what you do with the data that the connected product provides in order to enhance the customer experience and optimize busi...
Up until last year, enterprises that were looking into cloud services usually undertook a long-term pilot with one of the large cloud providers, running test and dev workloads in the cloud. With cloud’s transition to mainstream adoption in 2015, and with enterprises migrating more and more workloads into the cloud and in between public and private environments, the single-provider approach must be revisited. In his session at 18th Cloud Expo, Yoav Mor, multi-cloud solution evangelist at Cloudy...
In his session at @ThingsExpo, Chris Klein, CEO and Co-founder of Rachio, will discuss next generation communities that are using IoT to create more sustainable, intelligent communities. One example is Sterling Ranch, a 10,000 home development that – with the help of Siemens – will integrate IoT technology into the community to provide residents with energy and water savings as well as intelligent security. Everything from stop lights to sprinkler systems to building infrastructures will run ef...
SYS-CON Events announced today that Enzu, a leading provider of cloud hosting solutions, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Enzu’s mission is to be the leading provider of enterprise cloud solutions worldwide. Enzu enables online businesses to use its IT infrastructure to their competitive advantage. By offering a suite of proven hosting and management services, Enzu wants companies to foc...
So, you bought into the current machine learning craze and went on to collect millions/billions of records from this promising new data source. Now, what do you do with them? Too often, the abundance of data quickly turns into an abundance of problems. How do you extract that "magic essence" from your data without falling into the common pitfalls? In her session at @ThingsExpo, Natalia Ponomareva, Software Engineer at Google, will provide tips on how to be successful in large scale machine lear...
SYS-CON Events announced today that Stratoscale, the software company developing the next generation data center operating system, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Stratoscale is revolutionizing the data center with a zero-to-cloud-in-minutes solution. With Stratoscale’s hardware-agnostic, Software Defined Data Center (SDDC) solution to store everything, run anything and scale everywhere...
Digital payments using wearable devices such as smart watches, fitness trackers, and payment wristbands are an increasing area of focus for industry participants, and consumer acceptance from early trials and deployments has encouraged some of the biggest names in technology and banking to continue their push to drive growth in this nascent market. Wearable payment systems may utilize near field communication (NFC), radio frequency identification (RFID), or quick response (QR) codes and barcodes...
Angular 2 is a complete re-write of the popular framework AngularJS. Programming in Angular 2 is greatly simplified – now it's a component-based well-performing framework. This immersive one-day workshop at 18th Cloud Expo, led by Yakov Fain, a Java Champion and a co-founder of the IT consultancy Farata Systems and the product company SuranceBay, will provide you with everything you wanted to know about Angular 2.
You think you know what’s in your data. But do you? Most organizations are now aware of the business intelligence represented by their data. Data science stands to take this to a level you never thought of – literally. The techniques of data science, when used with the capabilities of Big Data technologies, can make connections you had not yet imagined, helping you discover new insights and ask new questions of your data. In his session at @ThingsExpo, Sarbjit Sarkaria, data science team lead ...