How do I remove a retirement saving contribution credit?

[zwhawk]

Cleared it three times and it comes back every time. Is this a ploy to get us to pay more? What happens if we get in trouble?

[dmertz]

You could also be eligible for the credit for an amount shown with code D, E, F, G, H, S, AA, BB or EE in box 12 of a W-2.

The $64 credit is more than the cost to upgrade, so there is no real reason not to if you've actually made a qualifying contribution (assuming that you can pay the upgrade cost without paying it out of your refund which should incur a service charge).  If you really want to avoid the tax credit, in the Retirement Savings Contributions Credit section simply tell TurboTax that you were a full-time student.

[Izzy1556]

so my credit equals $2 which I thought was a lot low. This $2 will cost me $98 to file my federal and state return. I was not a full time student and don't want to get in trouble for lying on my tax return. Any suggestions?

[dmertz]

Telling TurboTax that you were a full-time student does not create a false indication on your tax return, it only serves to prevent TurboTax from allowing the credit.  You are fibbing to TurboTax, not to the IRS.

[Dawn 2]

I tried changing return to reflect student status to remove the $59 credit for retirement contribution. It removed it and lowered the return amt by $59 but when I tried to file the new excuse that required me to upgrade was that I paid excessive social security tax.  So I changed it back and it only showed the retirement contribution reason again. But it wants $150 for a $59 credit. I am switching to HR Block and see what that program does.

[MarilynG1]

@Dawn 2 See if you qualify for the Free File Program. 

[Ted311]

I have the same problem and so does H&R Block, I came here hoping to get around this issue. Neither company tells you about the issue until you finish the return. If its such a common thing to have an IRA it should be added to the EZ form. Its a way for the online tax companies to make money off of your credit. H&R allowed me to enter the item but I would have to print the return and NOT be able to file online...unless I paid the $49.99. What happened to just paying the online filing fee?

[DaveF1006]

There is no more 1040EZ forms. It is all one standard form.  Turbo Tax requires a Tax Payer to upgrade to Turbo Tax Deluxe to claim the Saver's credit.

[DuBurke]

Having the same problem. There is no "tools" option on my end either though the app or the website on my computer

[FangxiaL]

Clarify: what is the particular reason for removing the saver's credit? 

A taxpayer qualifies for the credit if he has contributed to a 401(k) on the job or make contributions to a Traditional IRA or Roth IRA.

@DuBurke

[dmertz]

For people who made only small retirement contributions or otherwise have only a small a tax liability, the cost to upgrade to a version of TurboTax that supports filing Form 8880 exceeds the amount of the credit, so claiming the credit costs them money unless they chose to abandon TurboTax and file some other way.

[Diane2022]

That didn't help.  I'm still receiving message that I need to upgrade.  I do not want to pay over $60 to have this $40 credit.

[MarilynG1]

On your W-2 entry, delete the amount in Box 12, with Code D for retirement plan contributions.

This is what is generating the Form 8880 for the Saver's Credit.

Type 'w-2' in the Search area, then click on 'Jump to W-2' to get back to your entry. 

[aarias24]

This doesn't work, still wanting me to upgrade to file :(

[JohnW152]

To delete your Retirement Savings Contribution Credit in TurboTax Online, you’ll need to perform some trickery.

To qualify for the credit, you have to meet all four of these requirements:

1. You are not a full-time student
2. Age 18 or older
3. No one else claims you as a dependent on their 2021 tax return
4. Your adjusted gross income (AGI) does not exceed:
   • $66,000 if married filing jointly
   • $49,500 if head of household
   • $33,000 if single, married filing separately, or a qualified widow(er)

So, to suppress the credit:

1. Select My Info in the left pane and begin the interview
2. On the Personal info summary page, select Edit to the right of your (or your spouse’s) name
3. On the Were you a full-time student in 2021? screen, select the Yes checkbox

If you encounter any education-related questions laterr in the interview that don’t apply to you, simply skip past the questions.

Don’t worry – the IRS doesn’t see the question about whether you were a full-time student.

@aarias24