Federal credits
Saver's credit: the retirement savings contributions credit
Workers with modest incomes who put money into a retirement account get part of it back as a credit. It is not refundable, so it only helps if you owe income tax.
Saver's credit: rate and amount
Saver's credit you can use, 2025
$500
| Credit rate at this AGI | 50% |
| Credit before the tax limit | $500 |
| Federal income tax before credits (estimate) | $638 |
The saver's credit is nonrefundable: it can lower your tax to zero, never below.
The saver's credit, officially the retirement savings contributions credit, equals 50%, 20% or 10% of up to $2,000 of contributions to an IRA, a 401(k), a 403(b), a SIMPLE plan or an ABLE account, $4,000 for a couple filing jointly. The rate depends on AGI. For 2025, a single filer gets 50% with AGI up to $23,750, 20% up to $25,500 and 10% up to $39,500; a head of household $35,625, $38,250 and $59,250; a married couple filing jointly $47,500, $51,000 and $79,000. For 2026, Notice 2025-67 raises the joint limits to $48,500, $52,500 and $80,500. You must be 18 or older, not a full-time student and not claimed as a dependent. The credit is nonrefundable, so it is worth at most your income tax after other credits such as the child tax credit.
IRS and state rules read by Radif Partners · Editorial policy · Method and sources
AGI limits for 2025
| Filing status | 50% | 20% | 10% |
|---|---|---|---|
| Single, married filing separately | up to $23,750 | up to $25,500 | up to $39,500 |
| Head of household | up to $35,625 | up to $38,250 | up to $59,250 |
| Married filing jointly | up to $47,500 | up to $51,000 | up to $79,000 |
AGI limits for 2026
| Filing status | 50% | 20% | 10% |
|---|---|---|---|
| Single, married filing separately | up to $24,250 | up to $26,250 | up to $40,250 |
| Head of household | up to $36,375 | up to $39,375 | up to $60,375 |
| Married filing jointly | up to $48,500 | up to $52,500 | up to $80,500 |
How the credit is computed
Add your contributions for the year, subtract any distributions received in the two years before the due date of the return, cap the result at $2,000 per person, and multiply by the rate for your AGI. Form 8880 has the lines. A worker who puts $1,000 into an IRA with AGI of $23,000, filing single, gets $500 back, provided the tax is at least that.
The limit on the credit is your tax after the nonrefundable credits that come before it, such as the child tax credit. The tool above estimates the tax on the standard deduction and the federal brackets, and subtracts the child tax credit for the children you enter.
Where it fits with the other credits
The saver's credit and the earned income credit reach roughly the same households, but they work in opposite ways: the earned income credit is paid even with no tax, the saver's credit only reduces tax. Households in the phase-out of the earned income credit, who owe some tax, are the ones most likely to use both. The IRS saver's credit page describes eligible accounts.