Short Answer
The Saver's Credit (Retirement Savings Contributions Credit) under IRC §25B is a nonrefundable federal tax credit worth 50%, 20%, or 10% of up to $2,000 of retirement contributions per person ($4,000 for a married couple), so the maximum credit is $1,000 per person or $2,000 per couple. Your credit rate depends on your adjusted gross income and filing status. For 2026, the credit phases out entirely above $40,250 AGI (single, MFS, or qualifying surviving spouse), $60,375 (head of household), or $80,500 (married filing jointly); the 50% rate applies below $24,250 / $36,375 / $48,500. To qualify you must be 18 or older, not a full-time student, and not claimed as a dependent. The credit is nonrefundable, so it cannot exceed your income tax and does not carry forward. You claim it on Form 8880. Starting in 2027 the credit is replaced by the Saver's Match for retirement contributions; 2025 and 2026 are the last credit years.
2026 and 2025 Saver's Credit AGI Brackets (Form 8880)
Credit Rate by AGI and Filing Status — IRC §25B
| Credit Rate | Married Filing Jointly | Head of Household | Single / MFS / QSS |
|---|
| Tax Year 2026 (Notice 2025-67) |
| 50% of contributions | AGI ≤ $48,500 | AGI ≤ $36,375 | AGI ≤ $24,250 |
| 20% of contributions | $48,501 - $52,500 | $36,376 - $39,375 | $24,251 - $26,250 |
| 10% of contributions | $52,501 - $80,500 | $39,376 - $60,375 | $26,251 - $40,250 |
| 0% (no credit) | over $80,500 | over $60,375 | over $40,250 |
| Tax Year 2025 (Rev. Proc. 2024-40) |
| 50% of contributions | AGI ≤ $47,500 | AGI ≤ $35,625 | AGI ≤ $23,750 |
| 20% of contributions | $47,501 - $51,000 | $35,626 - $38,250 | $23,751 - $25,500 |
| 10% of contributions | $51,001 - $79,000 | $38,251 - $59,250 | $25,501 - $39,500 |
| 0% (no credit) | over $79,000 | over $59,250 | over $39,500 |
The maximum contribution counted is $2,000 per person, so the largest possible credit is $1,000 per person (50% × $2,000) or $2,000 for a married couple where both spouses contribute. The credit rate applies to the lower of your actual contributions or the $2,000 cap, after reducing for any testing-period distributions. Qualifying surviving spouse uses the same column as single and married filing separately, per §25B(b)(2).
How the Saver's Credit Calculation Works
This tool follows the same order as IRS Form 8880. For the full rules - eligibility, eligible accounts, the testing period, and the 2027 Saver's Match transition - see the Saver's Credit Guide.
Step 1: Confirm Eligibility Confirmed
Under IRC §25B(c) you must be at least 18 at the end of the tax year, not a full-time student during any part of five calendar months, and not claimed as a dependent on someone else's return. If you fail any one of these three tests, the credit is $0 regardless of income or contributions. The calculator gates the result on this answer.
Step 2: Total Eligible Contributions, Capped at $2,000 Each Confirmed
Add your eligible contributions and (on a joint return) your spouse's, then cap each person's amount at $2,000 under §25B(a). Only the first $2,000 per person ever counts toward the credit, so contributing more than $2,000 does not increase the Saver's Credit.
Step 3: Subtract Testing-Period Distributions Confirmed
Reduce eligible contributions (not below zero) by any retirement-account distributions you and your spouse received during the testing period - the current year, the two preceding years, and the period through the filing deadline - under §25B(d)(2). Rollovers and trustee-to-trustee transfers are excluded. A recent withdrawal can wipe out the credit even if you made new contributions.
Step 4: Apply the Credit Rate Confirmed
Look up your credit rate (0.50, 0.20, or 0.10) from the AGI bracket for your filing status and year, then multiply by the eligible contributions to get the tentative credit. AGI above the top of the table gives a 0% rate.
Step 5: Apply the Nonrefundable Limit Confirmed
The Saver's Credit is nonrefundable, so the final credit is the smaller of the tentative credit or your federal income tax liability before the credit. If you enter a tax-liability figure, the calculator applies this cap; if you leave it at zero, it shows the tentative (maximum) credit. Any amount the liability cannot absorb is lost - the credit does not carry forward.
Maximum Credit by Rate and Filing Status
Because the credit applies to up to $2,000 of contributions per person, the dollar ceiling depends only on your rate and how many spouses contribute. This table shows the maximum credit at each rate.
Maximum Saver's Credit (at the full $2,000 / $4,000 contribution)
| Credit Rate | Single / HOH / one spouse | Married Filing Jointly (both contribute) |
|---|
| 50% | $1,000 | $2,000 |
| 20% | $400 | $800 |
| 10% | $200 | $400 |
| 0% | $0 | $0 |
Two practical notes follow. First, the 50% bracket is the high-value zone: a single worker who contributes $2,000 and lands in the 50% band gets a $1,000 credit on top of any deduction for the same contribution. Second, because the credit is nonrefundable, a worker whose tax is already zero gets nothing from it - which is exactly the gap the 2027 Saver's Match is designed to close.
Frequently Asked Questions
What is the Saver's Credit and how much is it worth in 2026?
The Saver's Credit, formally the Retirement Savings Contributions Credit under IRC §25B, is a nonrefundable federal tax credit for lower- and moderate-income workers who contribute to a retirement account. It is worth 50%, 20%, or 10% of up to $2,000 of contributions per person ($4,000 for a married couple filing jointly), depending on adjusted gross income. The maximum credit is therefore $1,000 per person, or $2,000 for a married couple, when the 50% rate applies. Because the credit is nonrefundable, it can reduce your federal income tax to zero but cannot create or increase a refund beyond your tax liability, and any unused amount does not carry forward.
What are the income limits for the Saver's Credit in 2026?
For 2026 (per IRS Notice 2025-67 under Rev. Proc. 2025-32), the Saver's Credit phases out entirely above $40,250 of adjusted gross income for single, married-filing-separately, and qualifying-surviving-spouse filers; $60,375 for head of household; and $80,500 for married filing jointly. The 50% rate applies up to $24,250 single / $36,375 head of household / $48,500 joint; the 20% rate applies in the next band up to $26,250 / $39,375 / $52,500; and the 10% rate applies up to the top limit. For 2025 the top limits are $39,500 single / $59,250 head of household / $79,000 joint. AGI above the top limit means a 0% rate and no credit.
Which retirement contributions qualify for the Saver's Credit?
Eligible contributions under IRC §25B(d)(1) include contributions to a traditional or Roth IRA; elective deferrals to a 401(k), 403(b), governmental 457(b), SARSEP, or SIMPLE IRA; voluntary after-tax employee contributions to a qualified retirement plan or the federal Thrift Savings Plan; and contributions by a designated beneficiary to an ABLE account under §529A. Rollover contributions never qualify. Eligible contributions are reduced (but not below zero) by any distributions you received from these accounts during the testing period - the current year, the two preceding years, and the period up to the filing deadline.
Is the Saver's Credit refundable?
No. The Saver's Credit is a nonrefundable credit. It can reduce your federal income tax liability to zero, but it cannot reduce your tax below zero or be paid out as a refund on its own, and unused credit does not carry forward to a future year. This is why the credit provides no benefit to a worker whose income tax is already zero after the standard deduction and other credits, even if their income is within the AGI brackets. Starting with tax year 2027, the federal Saver's Match created by SECURE 2.0 Act §103 will replace the credit for retirement-plan and IRA contributions with a direct matching deposit into the account, which removes the nonrefundable limitation for most savers.
Who is eligible for the Saver's Credit?
To claim the Saver's Credit under IRC §25B(c), you must be at least 18 years old at the end of the tax year, not a full-time student during any part of five calendar months of the year, and not claimed as a dependent on someone else's return. You must also have made eligible retirement contributions and have adjusted gross income within the applicable brackets for your filing status. A full-time student, a dependent, or anyone under 18 cannot claim the credit regardless of income or contribution amount.
How do recent retirement distributions affect the Saver's Credit?
Under IRC §25B(d)(2), your eligible contributions are reduced by the total of any distributions you (and your spouse, if filing jointly) received from retirement accounts during the testing period. The testing period is the current tax year, the two tax years before it, and the period after the tax year up to the due date of your return (including extensions). Trustee-to-trustee transfers and rollovers are not counted as distributions for this purpose. The reduction means a recent retirement withdrawal can shrink or eliminate your Saver's Credit even when you also made new contributions in the same year.
What is Form 8880?
Form 8880, Credit for Qualified Retirement Savings Contributions, is the IRS form used to figure and claim the Saver's Credit. You enter your (and your spouse's) eligible contributions, subtract testing-period distributions, cap each person's contributions at $2,000, look up the credit rate decimal (0.50, 0.20, or 0.10) from the AGI table for your filing status, and multiply to get the tentative credit. The credit is then limited to your tax liability and carried to Schedule 3 of Form 1040. A full-time student, a dependent, or a taxpayer under 18 is not allowed to file Form 8880.
Can I claim the Saver's Credit and deduct my IRA contribution?
Yes. The Saver's Credit is in addition to any deduction or exclusion you receive for the same contribution. A traditional IRA or 401(k) contribution can produce both an above-the-line deduction (or pre-tax exclusion) and the Saver's Credit, and a Roth IRA contribution can produce the credit even though it is not deductible. The credit is calculated on the contribution amount up to $2,000 per person, independent of whether that contribution was pre-tax or after-tax. This stacking is what makes the credit especially valuable for eligible savers in the 50% bracket.
Is the Saver's Credit going away in 2027?
The Saver's Credit for retirement-plan and IRA contributions applies for the last time in tax year 2026. Under SECURE 2.0 Act §103, beginning in tax year 2027 it is replaced by the Saver's Match, a federal contribution equal to 50% of up to $2,000 of retirement contributions per person, deposited directly into the saver's IRA or retirement plan rather than claimed as a credit on the return. The §25B credit continues to apply to ABLE account contributions after 2026. For 2025 and 2026 returns, the rules in this calculator are the ones that apply.
What to Do Next
If You Are in the 50% Band
This is the highest-value zone. Contribute up to $2,000 per person to an IRA, 401(k), or other eligible account before the deadline (IRA contributions can be made up to April 15) to lock in a credit of up to $1,000 each. Pair the credit with a traditional contribution to also capture the deduction. Check your number with the Roth IRA Contribution Calculator or the 401(k) Contribution Calculator.
If You Are Just Over the Limit
A traditional (pre-tax) IRA or 401(k) contribution lowers your AGI, which can pull you into a higher credit band or into eligibility. Estimate the AGI effect with the AGI & MAGI Calculator, then see whether a larger pre-tax contribution moves you below the next threshold for your filing status.
If Your Tax Is Already Low or Zero
The credit is nonrefundable, so it may be capped below the headline amount. The contribution still earns tax-free or tax-deferred growth, and from 2027 the Saver's Match will pay the benefit directly into your account regardless of tax liability. Read the Saver's Credit Guide for the transition details.
If You Took a Recent Distribution
Check whether a withdrawal in this year or the two prior years reduces your eligible contributions under the testing-period rule. A direct trustee-to-trustee rollover does not count as a distribution, so future moves can be structured to preserve the credit. When in doubt, run Form 8880 line by line.