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melissaforpeace315
Level 3

Savers credit questions

Hello!  I heard that I might qualify for the Savers Credit considering that I've contributed to both a Roth IRA and a 401k and only worked for four months in 2020 (meaning that I made less than $30,000 in 2020).  I found this information on the IRS site: https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-savings-contributions-save...

 

 Unfortunately, I filed my 2020 taxes already through TurboTax. I don't recall them asking if I qualify for the Savers credit?   Does that mean that I lost it?   What do I do?  any help would be much appreciated!  Thank you!

3 Replies
DanaB27
Expert Alumni

Savers credit questions

No, it doesn't mean you lost the Credit.

 

Please check Schedule 3 line 4 if you received Retirement savings contributions credit.  Also, look if you have Form 8880 that calculates the Savers Credit. Please be aware if you had no tax due then you won't be able to get the credit because it is a nonrefundable credit (can only lower your taxes to $0 and not more).

 

If you do not see it on Schedule 3 line 4 but you qualify according to IRS Retirement Savings Contributions Credit then you have to file an amended return (1040X) to make changes. But you might want to wait until your refund or payment is processed. Please be aware that you can e-file your 2020 amended federal tax return, but most states require amendments to be printed and filed by mail. Please see FAQ How to amend a tax return for instructions.

 

Please see the links below when Form 1040X is available:

 

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melissaforpeace315
Level 3

Savers credit questions

@DanaB27 wait so the fact that I got a refund from doing my 2020 taxes, means that I don't qualify for Savers Credit?

 

Did the free TurboTax package (my AGI is under $37k)  ask people specific questions to see if they qualify?   I don't recall?    In addition, I just checked my tax return document and it only shows a form 1040 and I don't see any form 8880.

 

What do I need to do to ensure that I qualify and receive the Savers Credit next year?   I think that next year I won't be getting a refund and will need to owe the IRS instead.

 

Thank you so much for your help!

DanaB27
Expert Alumni

Savers credit questions

Not necessarily, you total tax is on line 18 of Form 1040. This tax is first reduced by the Child Tax Credit on line 19 (if it applies to you) then the nonrefundable credits from Schedule 3 reduce the tax amount in the order shown on Schedule 3 in Part I. 

 

For example Line 18 total tax says $2,200, you get the Child Tax Credit of $2,000 and a Credit for child care expenses of  $200 then you won't be able to get any Saver's Credit because your tax is already $0 from the other credits.

 

 

If you believe that you qualify for the credit then please start an amended return once the form is ready to see if you qualify.

 

To get to the Saver's Credit questions if not asked:

 

  1. Click on "Federal"
  2. Click on "Deductions & Credits"
  3. Scroll down to "Retirement and Investment" and click "Show more"
  4. Click "Start" next to "Retirement Savings Contribution Credit"

 

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