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duderino79
New Member

Why am I being asked about retirement distributions from 2017, 2018 and 2019 for my 2020 tax return, in regards to a Retirement Savings Contribution Credit?

I already paid taxes on my distributions from 2017, so it shouldn't be deducted from the Savings Credit for what I saved to my retirement in 2020 correct?
2 Replies
dmertz
Level 15

Why am I being asked about retirement distributions from 2017, 2018 and 2019 for my 2020 tax return, in regards to a Retirement Savings Contribution Credit?

Its asking about distributions made after 2017.  Distributions made after 2017 and before the due date of your tax return if not rolled over or converted to Roth reduce the amount of new contributions that are eligible to be considered when calculating this credit.  This is to avoid one getting the credit for simply taking out the retirement money just to use it to make a new contribution and get a credit without actually increasing retirement savings.

MaryK1101
Expert Alumni

Why am I being asked about retirement distributions from 2017, 2018 and 2019 for my 2020 tax return, in regards to a Retirement Savings Contribution Credit?

Any distributions you make in the prior three years reduces the amount of the Saver's Credit.

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