IRA owners have until April 17, 2012 to make a 2011 contribution to their IRA. This year, it is not too late to get a Saver’s Credit for IRA contributions. A number of IRA owners may qualify for the Saver’s Credit of up to $1,000 ($2,000 if filing jointly) on their 2011 tax return for 2011 IRA contributions. The Saver’s Credit reduces the amount of income tax that may be owed dollar-for-dollar, but not less than zero.
Who is eligible for the Saver’s Credit?
To qualify for the Saver’s Credit (Retirement Savings Contributions Credit) for eligible IRA contributions, the IRA owner’s 2011 adjusted gross income cannot be more than:
• $56,500 when filing status is married, filing jointly
• $42,375 when filing status is head of household
• $28,250 when filing status is single, married filing separately. or qualifying widow(er)
Additionally, the IRA owner cannot be:
• Younger than age 18
• A full-time student
• Claimed as a dependent
The Saver’s Credit may also be taken for contributions to 401(k), SIMPLE IRA, SARSEP, 403(b), 501(c)(18), and governmental 457(b) plans, as well as voluntary after-tax employee contributions to qualified retirement and 403(b) plans.
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