Few Aware of Eligibility for Saver's Tax Credit

In a press release Transamerica said the survey found only 9% of American adults who are eligible for the credit are familiar with it. Only 16% of the overall American public said they are aware of the credit.

One concern Transamerica noted in its release is that 29% of survey respondents who meet the credit’s income limits either have filed or plan to file their taxes on Form 1040EZ, which does not provide for claiming the credit. Additionally adding to the confusion may be the fact the credit is most commonly known as the Saver’s Credit, but the IRS refers to it as the “Retirement Savings Contributions Credit” and the “Credit for Qualified Retirement Savings Contributions” in its forms and publications.  

The Saver’s Credit was extended by the Pension Protection Act of 2006 and allows for a credit up to $1,000 annually (up to $2,000 annually for married taxpayers filing jointly) for singles earning $25,000 or less, head-of-household’s earning $37,500 or less and married couples filing jointly earning $50,000 or less.