savers credit for roth not correct?

[landeskb]

Adjustable gross income of $18,832

Taxable income $4,230

Total Tax (line 24) of $398

Roth contribution $6,500

Turbo tax says no savers credit because no tax owed. Why not a credit of $398?

[dmertz]

This credit can only be used to reduce income tax, and not below zero.  It cannot be used to reduced Other taxes such as self-employment tax or penalties for early distributions from retirement accounts.

[landeskb]

The tax of $398 is directly from the tax table for single filers with income between $3,950 and $4,000.  I forgot to mention she had ordinary dividends of $270.

[dmertz]

Examine line 18 of Form 1040.  If that line is already zero, this tax credit is not permitted.

[landeskb]

I just created a new return with all of the same info and it correctly calculates the savers credit. There must be a bug somewhere that is using her student status from 2023 or something like that.

[landeskb · Accepted solution]

That line is $398 on both accounts: the original and the new person I just created.  See my note a few minutes ago.  There is a bug. Because my new return that I just created with all the same info correctly calculates it.  I am wondering if it is using her student status from 2023 somehow on the original return.

I'm good.  We will just use the new return instead of the original one.