The saver’s credit can knock as much as $1,000 or $2,000 off your federal income tax bill, depending on whether you file an individual or joint return. Yet many folks don’t know this tax credit exists.
That’s right: Less than half of workers are aware of the saver’s credit, according to a survey by the Transamerica Center for Retirement Studies. And even retirees might be able to qualify for this credit if they are still saving in retirement accounts.
If you, too, are unfamiliar with the saver’s credit — also known as the retirement savings contributions credit — now’s as good a time as any to get acquainted. The IRS just announced that the income limits for the credit — which are a key factor in determining your eligibility for the tax break — have increased for the 2026 tax year on account of inflation.
This inflation adjustment will affect your 2026 tax return — the one that’s due by April 2027.
Read on for everything you need to know to take advantage of this tax credit.
What types of contributions qualify for the saver’s credit?
The first step toward becoming eligible for the retirement savings contributions credit — as its formal name implies — is saving money in a retirement account.
According to the IRS, you may be able to take the tax credit for the following types of contributions:
- Contributions to traditional or Roth individual retirement accounts
- Elective salary deferral contributions to a 401(k), 403(b), governmental 457(b), Salary Reduction Simplified Employee Pension (SARSEP) plan or Savings Incentive Match Plan for Employees (SIMPLE) plan
- Voluntary after-tax employee contributions to a qualified retirement plan (including the Thrift Savings Plan) or 403(b) plan
- Contributions to a 501(c)(18)(D) plan
- Contributions to an Achieving a Better Life Experience (ABLE) account for which you are the designated beneficiary
Rollover contributions don’t qualify, though.
How much is the saver’s credit worth?
The saver’s credit is worth 10%, 20% or 50% of the amount of money that you contribute to qualifying accounts in a given year, depending on your income. (More on that in a minute.) The maximum possible contribution is $2,000 or, for married couples filing a joint return, $4,000.
That means the maximum value of the saver’s credit itself is $1,000 or $2,000, depending on your tax-filing status. And that comes right off the top of your tax bill — assuming that you end up owing the IRS for 2026.
Unfortunately, the saver’s credit is a nonrefundable tax credit as opposed to a refundable tax credit. Nonrefundable credits are less useful in the sense that they typically can only lower your tax bill — not result in you receiving a refund or increase the amount of your refund.
What are the income limits for the saver’s credit?
The saver’s credit is for taxpayers with low to moderate incomes. To be eligible for it, your adjusted gross income (AGI) must be under a certain threshold.
For 2026, you may be eligible for the saver’s credit if your AGI is:
- $80,500 or less, and your tax-filing status is married filing jointly (up from $79,000 for 2025)
- $60,375 or less, and your tax-filing status is head of household (up from $59,250)
- $40,250 or less, and your tax-filing status is single, married filing separately or surviving spouse (up from $39,500)
It’s too soon to know for certain what your AGI will be for 2026, of course. But you can get a ballpark figure by checking your most recently completed federal tax return. Look for your latest AGI on line 11 of your 2024 return.
What are the AGI ranges for the saver’s credit?
If you are eligible for the saver’s credit, your AGI also determines how much the credit is worth — that is, the percentage of your retirement account contributions that counts toward the credit. For 2026, those AGI ranges are as follows:
| How much the credit is worth | For married filing jointly | For head of household | For all other tax-filing statuses |
|---|---|---|---|
| 50% of your contribution | AGI is up to $48,500 (was $47,500 for 2025) | AGI is up to $36,375 (was $35,625 for 2025) | AGI is up to $24,250 (was $23,750 for 2025) |
| 20% of your contribution | AGI is $48,500 – $52,500 (was $47,500 – $51,000) | AGI is $36,375 – $39,375 (was $35,625 – $38,250) | AGI is $24,250 – $26,250 (was $23,750 – $25,500) |
| 10% of your contribution | AGI is $52,501 – $80,500 (was $51,001 – $79,000) | AGI is $39,376 – $60,375 (was $38,251 – $59,250) | AGI is $26,251 – $40,250 (was $25,501 – $39,500) |
Let’s say your AGI is $35,000 in 2026, and your tax filing status is single. If you contribute $2,000 to an eligible account for 2026, the saver’s credit would be worth 10% of that contribution. That’s $200 off your tax bill.
Who is eligible for the saver’s credit?
There are a few other stipulations to be eligible for the saver’s credit.
Notably, you must be 18 or older, not a student and not claimed as a dependent on someone else’s tax return.
Also, if you are withdrawing or recently withdrew savings from a workplace retirement plan, IRA or ABLE account, your eligible contributions may be reduced.
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