Retirement Savings Contributions Credit

You may be able to take this credit if you, or your spouse if filing jointly, made:

  • Contributions (other than rollover contributions) to a traditional or Roth IRA,
  • Elective deferrals to a 401(k) or 403(b) plan (including designated Roth contributions) or to a governmental 457, SEP, or SIMPLE plan,
  • Voluntary employee contributions to a qualified retirement plan (including the federal Thrift Savings Plan), or
  • Contributions to a 501(c)(18)(D) plan.

However, you can’t take the credit if either of the following applies.

  1. The amount on Form 1040, line 38, or Form 1040A, line 22, is more than $30,500 ($45,750 if head of household; $61,000 if married filing jointly).
  2. The person(s) who made the qualified contribution or elective deferral: (a) was born after January 1, 1998, (b) is claimed as a dependent on someone else’s 2015 tax return, or (c) was a student.

Student.   You were a student if during any part of five calendar months of 2015 you were enrolled as a full-time student at a school, or took a full-time, on-farm training course given by a school or a state, county, or local government agency.

School.   A school includes a technical, trade, or mechanical school. It doesn’t include an on-the-job training course, correspondence school, or school offering courses only through the Internet.

How to take the credit.   Figure the credit on Form 8880. Enter the credit on your Form 1040, line 51, or your Form 1040A, line 34, and attach Form 8880 to your return.

I created this blog to help understand certain basic aspects of U.S. tax law. Of course, each situation is unique and nothing that is on this site will ever replace the expert advice of a tax professional.

Please do not hesitate to contact me should you have any question