Form 8880 Saver's Credit - Define 'Qualified Retirement Plans as Defined in Section 4974(c)'

[Donza]

I am trying to find more information regarding what is included in 'qualified retirement plans' in relation to distributions that must be included for 2020-2023 when calculating credit for contributions to retirement plans. 

in form 8880 it say this:

Line 4

Enter the total amount of distributions you, and your spouse if filing jointly, received after 2019 and before the due date of your 2022 return (including extensions) from any of the following types of plans.

• Traditional or Roth IRAs, or ABLE accounts.

• 401(k), 403(b), governmental 457(b), 501(c)(18)(D), SEP, SIMPLE, or the federal TSP.

• Qualified retirement plans, as defined in section 4974(c)

I have done searches on IRS.gov looking for section 4974, but I cannot find it. What document is it in relation to. Where does the IRS define Qualified Retirement Plans in section 4974? in relation to distributions that are deducted from contributions for the Savers Credit?

Should pension payments be included in distributions?

[DaveF1006]

This document provides all possible retirement plans covered under section 4974(c). The document provides links for all of the plan possibilities that exist in this section.  You can select each link in the document to see if any of these apply to you.

Generally, yes, the amount of any contribution eligible for the Saver’s Credit is reduced by certain withdrawals/distributions taken for the last three years (See IRS Announcement 2001-106, Q&As 4 and 5). This is why Turbo Tax is asking these questions.

If you have received pension payments, these are the same as distributions/withdrawals and may affect the amount of a payer's credit you receive.

[dmertz]

https://www.law.cornell.edu/uscode/text/26/4974#c

Most of the plans covered by section 4974(c) are listed in the first two bullets, but add to that any other plan covered by section 401(a), which includes qualified pension plans (defined benefit plans).  This anti-abuse feature of the tax code is there to prevent you from taking a distribution from a retirement account an turn it around as a new contribution just to get the credit, without actually increasing your retirement savings.

See IRS Pub 590-A Chapter 3 for more details:  https://www.irs.gov/pub/irs-pdf/p590a.pdf