Key takeaways

• The Saver’s Credit is a non-refundable tax credit designed to help low- and mid-income taxpayers boost retirement savings.
• Individuals can receive up to $1,000, while married couples filing jointly can receive up to $2,000.
• The Saver’s Credit will be replaced by the Saver’s Match starting in tax year 2027.

Contributing to tax-advantaged retirement accounts can be a good way to save money on your taxes while also helping to build wealth for retirement. 

The Saver’s Credit (officially titled the Retirement Savings Contributions Credit) is a federal tax credit — up to $1,000 for individuals and up to $2,000 if married filing jointly — offered to certain taxpayers who make eligible contributions to a traditional or Roth IRA, 401(k), 403(b), governmental 457(b), SARSEP, or SIMPLE plan.¹

The purpose of the Saver’s Credit is to incentivize low and moderate-income workers to save for retirement. But it won’t be around forever. Beginning in tax year 2027, the Saver’s Credit will be replaced by the Saver’s Match, which was created by the SECURE 2.0 Act of 2022.²

How does the Saver's Credit work?

The Saver’s Credit is a tax credit, not a deduction. A tax deduction works by reducing your taxable income (meaning the portion of your income that’s subject to taxation). And by reducing your taxable income, it also reduces your tax liability. 

Tax credits like the Saver’s Credit, on the other hand, directly reduce your tax liability. So, if you’re eligible for a $2,000 tax credit, your tax liability is $2,000 lower. That will either help reduce the amount you’ll owe in taxes or will increase the amount of your tax refund.

However, the Saver’s Credit is a non-refundable tax credit.³ That means that it can only reduce your tax liability to zero. For example, if you’re eligible for a $1,000 tax credit and your tax liability for the year is $500, you can only get a credit of $500. This is in contrast to a refundable tax credit, like the Earned Income Tax Credit, which allows you to receive a refund for any amount that exceeds the total tax you owe.⁴

Read more: Tax credits: Everything you need to know 

How much is the Saver’s Credit? 

The maximum possible Saver’s Credit is $1,000 for individuals and $2,000 for married couples filing jointly. However, the amount you can qualify for depends on your income and the amount you contribute to your tax-advantaged accounts^.5

The IRS allows you to get a credit of either 50%, 20%, 10%, or 0% of your contributions, depending on your adjusted gross income (AGI).6 The table below shows the credit amount you may be eligible for based on your income for the 2025 tax year:⁷ 

The table below shows the credit amount based on income for tax year 2026:⁸

For example, suppose you’re a single filer with an AGI of $20,000 or less. You’re eligible for a tax credit of 50% of your retirement contributions. So, if you contribute $2,000 to an IRA, you’ll get the maximum Saver’s Credit of $1,000. However, if your income was $25,000 and you contributed the same amount, you would be eligible for 20% of your contribution and your tax credit would only be $200.

The maximum contribution that can qualify for the Saver’s Credit is $2,000 for individuals and $4,000 for married couples filing jointly. As a result, only those individuals eligible for the 50% credit rate would be able to get the full credit amount.⁹ 

How to claim the Saver’s Credit 

Before you can claim the Saver’s Credit, you’ll have to first make sure you’re eligible. To be eligible for the tax credit, you must meet the following requirements:¹⁰ 

1. You’re age 18 or older 

2. You're not claimed as a dependent on anyone else’s tax return 

3. You’re not a student  

If you’re eligible for the Saver’s Credit, you’ll claim it using Form 8880, Credit for Qualified Retirement Savings Contributions. You’ll complete the designated lines on this form and file it with your annual tax return, Form 1040 or 1040A. You can’t claim the Saver’s Credit when filing with IRS Form 1040EZ.¹¹ 

Changes ahead: The Saver’s Match

The Saver’s credit is set to expire after tax year 2026 and will be replaced by the Saver’s Match created by the SECURE 2.0 Act of 2022. Rather than receiving a non-refundable credit, the Saver’s Match will allow eligible individuals to have matches contributed directly to their retirement accounts.¹²

Savers with modified AGIs below $20,500 ($41,000 for married filing jointly) will qualify for a 50% federal match on up to $2,000 in retirement savings — that is, a maximum match of $1,000. Those who earn up to $35,500 ($71,000 for married filed jointly) will be eligible for reduced matches. The income thresholds will be adjusted for the cost of living for years after 2027.¹³

Created in the early 2000s the Saver’s Credit remains in effect and can be a useful tool for some earners to boost retirement saving until it’s replaced. If you aren’t sure what steps to take with Saver’s Credit or the upcoming Saver’s Match, consider seeking professional guidance that can help with tax and financial planning.