Credit for Qualified Retirement Savings Contribution

Posted by: Automan on Wednesday, April 30th, 2008

If you're new here, you may want to subscribe to my RSS feed. Thanks for visiting!

Credit for Qualified Retirement Savings Contribution

Here we are again its tax time. And with all the turmoil in our country not to mention in our private lives, Uncle Sam expects us to sit up and take notice of the time of year and file our tax returns with the IRS. Well I dont know about you but with all the tax law changes and the comings and goings it can be down right confusing for the average American. I spend half the year before January studying and preparing to meet all of my clients needs and goals, and I still can find a surprise or two at my desk each morning. Take for instance the new Savers Tax Credit, this little gem will only be with us the next four years, by the time it catches onitll be gone.

Retirement Savings Contribution Credit is a tax credit allowing eligible contributions to an employer sponsored retirement plan or an IRA become tax deductible. A percentage of your qualifying retirement contributions are determined by using federal form 8880.

Qualifying retirement plans are Traditional and or Roth IRA contributions, and salary reduction contributions to most employer sponsored retirement plans (401k). You may include certain voluntary after tax plans as well.

You cannot claim this credit if any of these circumstances apply to you:
You were born after January 1,1985
You are claimed as dependents on another persons return
You are a full time student

Table of Income and Filing Status Percentage for Retirement Savings Contribution
If your filing status isAnd Your AGI isYour Percentage is
Married Filing JointlyNot over 30,00030,000——32,50032,500——-49,99950,000 or Above5020100
Head of HouseholdNot over 22,50022,500—-24,37524,375—-37,50037,501 or Above5020100