Life Support - Tax Facts
Get a Tax Break Simply for Saving for Retirement
A Tax Fact from The Tax Institute at H&R Block
Don't think you can save for retirement? Well, for millions of Americans it just got easier. How? With the Saver's Credit.
Here's how it works: Eligible taxpayers who voluntarily contribute to IRAs, 401(k)s and similar qualified workplace retirement programs, can reduce their taxes by up to $1,000 per taxpayer, $2,000 if filing jointly, by taking advantage of the Saver's Credit.
The Saver's Credit is a dollar-for-dollar tax credit on money a taxpayer contributes to a qualified retirement savings plan. Taxpayers can actually benefit twice from their retirement contribution: first by reducing their taxable income through the pre-tax contribution and again by claiming the Saver's Credit -- a rare case of double dipping allowed by tax law.
The amount of the Saver's Credit depends on the taxpayer's adjusted gross income, filing status and amount contributed to a qualifying retirement program. Those with the lowest incomes receive the largest credit benefits. Income qualifications are: heads of household with incomes up to $39,000 in 2007; married filing jointly with incomes up to $52,000 and married individuals filing separately and single taxpayers with incomes up to $26,000 in 2007.
More good news: Taxpayers have until April 15, 2008 to take advantage of the Saver's Credit on their 2007 tax return.
This Tax Fact is brought to you by The Tax Institute at H&R Block.
To view other helpful tax information or listen to our Tax Fact podcasts, visit www.digits.hrblock.com
As always...everyone's tax situation is different, so be sure to consult a tax professional or financial advisor before making important financial decisions.
This Tax Fact is for educational purposes only and is not intended to be a substitute for seeking personalized, professional advice, nor is it intended to be used to avoid IRS penalties.
A Tax Fact from The Tax Institute at H&R Block
Don't think you can save for retirement? Well, for millions of Americans it just got easier. How? With the Saver's Credit.
Here's how it works: Eligible taxpayers who voluntarily contribute to IRAs, 401(k)s and similar qualified workplace retirement programs, can reduce their taxes by up to $1,000 per taxpayer, $2,000 if filing jointly, by taking advantage of the Saver's Credit.
The Saver's Credit is a dollar-for-dollar tax credit on money a taxpayer contributes to a qualified retirement savings plan. Taxpayers can actually benefit twice from their retirement contribution: first by reducing their taxable income through the pre-tax contribution and again by claiming the Saver's Credit -- a rare case of double dipping allowed by tax law.
The amount of the Saver's Credit depends on the taxpayer's adjusted gross income, filing status and amount contributed to a qualifying retirement program. Those with the lowest incomes receive the largest credit benefits. Income qualifications are: heads of household with incomes up to $39,000 in 2007; married filing jointly with incomes up to $52,000 and married individuals filing separately and single taxpayers with incomes up to $26,000 in 2007.
More good news: Taxpayers have until April 15, 2008 to take advantage of the Saver's Credit on their 2007 tax return.
This Tax Fact is brought to you by The Tax Institute at H&R Block.
To view other helpful tax information or listen to our Tax Fact podcasts, visit www.digits.hrblock.com
As always...everyone's tax situation is different, so be sure to consult a tax professional or financial advisor before making important financial decisions.
This Tax Fact is for educational purposes only and is not intended to be a substitute for seeking personalized, professional advice, nor is it intended to be used to avoid IRS penalties.
