Everyone knows that saving for retirement is important.
However, that certainly doesn’t make it easy. Fortunately, there are many
credits and programs that exist to make it, at the very least, a little bit
easier.
One such credit is the Saver’s Credit, which was designed
specifically to help average people save for retirement. If you qualify for
this credit, you could enjoy a tax credit for as much as half of your
retirement contributions.
Are You Eligible?
Whether you are eligible for this credit or not and how much
of a credit you are eligible for depends on your filing status, as well as how
much you make each year. Some people can earn a 10% credit, while others earn a
20% credit or even the aforementioned 50% credit.
For people who are single, married filing separately, or
widowed, here are the eligibility factors:
l If
you have an adjusted gross income between $19,751 and $30,500, you are eligible
for the 10% credit.
l If
you have an adjusted gross income between $18,251 and $19,750, you are eligible
for a 20% credit.
l If
you have an adjusted gross income below $18,250, you are eligible for a 50%
credit.
Of course, if your status changes, your eligibility will
change as well. For head of household taxpayers, the limits are:
l If
you have an adjusted gross income between $29,626 and $45,750, you are eligible
for a 10% credit.
l If
you have an adjusted gross income between $27,376 and $29,625, you are eligible
for a 20% credit.
l If
you have an adjusted gross income below $27,375, you are eligible for a 50% credit.
For people who are married filing jointly, the limits are as
follows:
l If
you have an adjusted gross income between $39,501 and $61,000, you are eligible
for a 10% credit.
l If
you have an adjusted gross income between $36.501 and $39,500, you are eligible
for a 20% credit.
l If
you have an adjusted gross income below $36,500, you are eligible for a 50%
credit.
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