The 2026 Saver’s Credit income limits cap eligibility at an adjusted gross income of $80,500 for married filing jointly, $60,375 for head of household, and $40,250 for single, married filing separately, or qualifying surviving spouse filers, per IRS Notice 2025-67. The Saver’s Credit (formally the Retirement Savings Contributions Credit under IRC Section 25B) is a nonrefundable federal credit worth 50%, 20%, or 10% of up to $2,000 in retirement contributions per person.
For 2026, the Saver’s Credit income limits are $80,500 (married filing jointly), $60,375 (head of household), and $40,250 (single or married filing separately), up from $79,000, $59,250, and $39,500 in 2025. Below those limits, the credit equals 50%, 20%, or 10% of up to $2,000 in contributions per person, a maximum of $1,000 each (Source: IRS Notice 2025-67).
What are the 2026 Saver’s Credit income limits?
The 2026 Saver’s Credit income limits are the top adjusted gross income figures at which any credit is allowed: $80,500 for married filing jointly, $60,375 for head of household, and $40,250 for single, married filing separately, or qualifying surviving spouse filers, per IRS Notice 2025-67. Above those AGI figures the credit is zero.
Talk With Craig Wear's Team
Craig has helped IRA millionaires save over $1 million each in unnecessary taxes. Find out if a Roth conversion strategy fits your retirement, with no sales pressure and no product pitch.
These 2026 limits rose from the 2025 amounts of $79,000, $59,250, and $39,500. The table below shows the top AGI by filing status for both years (Source: IRS Notice 2025-67).
| Filing status | 2026 maximum AGI | 2025 maximum AGI |
|---|---|---|
| Married filing jointly | $80,500 | $79,000 |
| Head of household | $60,375 | $59,250 |
| Single / MFS / qualifying surviving spouse | $40,250 | $39,500 |
What are the 50%, 20%, and 10% credit-rate tiers for 2026?
The 2026 Saver’s Credit rate is 50%, 20%, or 10% of eligible contributions, set by your AGI and filing status. The 50% rate applies up to $48,500 for joint filers, $36,375 for head of household, and $24,250 for other filers. Rates then step down to 20% and 10% before reaching zero, using the exact IRC Section 25B breakpoints in IRS Notice 2025-67.
| Credit rate | Married filing jointly (AGI) | Head of household (AGI) | Single / MFS / QSS (AGI) |
|---|---|---|---|
| 50% of contribution | Up to $48,500 | Up to $36,375 | Up to $24,250 |
| 20% of contribution | Over $48,500 to $52,500 | Over $36,375 to $39,375 | Over $24,250 to $26,250 |
| 10% of contribution | Over $52,500 to $80,500 | Over $39,375 to $60,375 | Over $26,250 to $40,250 |
| 0% (no credit) | Over $80,500 | Over $60,375 | Over $40,250 |
These are the statutory breakpoints under sections 25B(b)(1)(A) through (D) as adjusted for 2026. Some third party guides list the 50% joint cutoff as $48,300; the figure confirmed in IRS Notice 2025-67 is $48,500.
Why does one extra dollar of AGI matter?
The Saver’s Credit rate drops in cliffs, not a smooth phase-out, so one extra dollar of adjusted gross income can cut the credit sharply. Crossing a breakpoint moves the whole calculation from 50% to 20%, from 20% to 10%, or from 10% to 0% (Source: Congressional Research Service Report IF11159).
Using the CRS 2025 illustration: a married couple at $47,500 AGI contributing $2,000 received a $1,000 credit, but one more dollar of AGI moved them into the 20% band and cut the credit to $400. The same cliff structure applies to the 2026 breakpoints above. Because a Roth conversion adds taxable income and can raise AGI above these limits, households weighing how much to convert to Roth in a low income year may weigh the effect on this credit.
How much is the Saver’s Credit worth in 2026?
For 2026, the Saver’s Credit equals your rate (50%, 20%, or 10%) times eligible contributions, capped at $2,000 per person or $4,000 for a married couple filing jointly. The maximum credit is $1,000 per person, or $2,000 for a couple both at the 50% rate (Source: IRS Notice 2025-67; IRS Form 8880 instructions).
| Credit rate | Maximum credit per person | Maximum credit, couple (MFJ) |
|---|---|---|
| 50% | $1,000 | $2,000 |
| 20% | $400 | $800 |
| 10% | $200 | $400 |
Each figure uses the $2,000 per person cap; contributions above it do not increase the credit. In practice the amounts claimed are modest: for tax year 2021, about 5.7% of taxpayers claimed the credit, at an average of roughly $191 (Source: CRS Report IF11159, citing IRS Statistics of Income data).
Who qualifies for the Saver’s Credit?
To claim the Saver’s Credit for 2026, a taxpayer generally must meet three tests on top of the income limits: be age 18 or older, not be a full-time student, and not be claimed as a dependent on another person’s return (Source: IRS, Retirement Savings Contributions Credit). All three must be met, and AGI must fall under the 2026 limit for the filing status.
- Age 18 or older during the tax year.
- Not a full-time student. The IRS treats you as a student if you were enrolled full time (or in full-time on-farm training) for any part of five calendar months during the year.
- Not a dependent on another person’s tax return.
Married couples filing jointly apply the three tests and the $2,000 cap to each spouse individually, so both can claim a credit if both qualify.
Which retirement contributions qualify?
Eligible 2026 contributions include traditional and Roth IRA contributions, elective deferrals to a 401(k), 403(b), governmental 457(b), SEP, SIMPLE, or the federal Thrift Savings Plan (TSP), voluntary after-tax contributions to a qualified plan, and ABLE account contributions by the designated beneficiary. Rollovers and employer contributions do not count (Source: IRS Form 8880 instructions).
Employer contributions, including 401(k) matching contributions, are not the participant’s own voluntary contributions and do not count (Source: IRS Form 8880 instructions, Line 2). Because a Roth conversion is a rollover of existing retirement funds rather than a new contribution, converted amounts are also not eligible for this credit.
How do recent withdrawals reduce the credit?
Recent withdrawals can reduce or erase the Saver’s Credit. On Form 8880 you subtract certain distributions taken during a testing period from your eligible contributions, and if those distributions equal or exceed the contributions, the credit falls to zero. The testing period covers the tax year, the two preceding years, and the period after year end up to the return due date, including extensions (Source: IRS Form 8880 instructions, Line 4).
For the 2026 credit, that means distributions received after 2023 and before the due date of the 2026 return, so amounts taken in 2024, 2025, 2026, and early 2027 generally count against contributions. Rollovers, trustee-to-trustee transfers, and returned excess contributions are excluded. Because required minimum distributions and other retirement withdrawals fall inside this window, timing matters.
Worked example
Suppose a single filer contributes $2,000 to a Roth IRA for 2026 and would otherwise receive a 50% credit of $1,000. If that person also took a $2,000 taxable distribution from a traditional IRA in 2025, inside the testing period, the distribution reduces the $2,000 of eligible contributions to $0, and the credit becomes $0 (Source: IRS Form 8880 instructions, Line 4). The contribution still helped retirement savings, but the recent withdrawal canceled the credit for that year.
Why can’t many low earners use the full credit?
Because the Saver’s Credit is nonrefundable, it can only offset income tax actually owed. Many lower-income savers owe little or no federal income tax after the standard deduction ($16,100 single, $32,200 married filing jointly for 2026), so the credit they can use is often smaller than the amount computed on Form 8880, and any unused portion does not carry forward (Source: CRS Report IF11159).
For example, a filer may compute a tentative $1,000 credit at the 50% rate, but if income tax before the credit is only $300, the usable credit is capped at $300 and the other $700 is lost, one reason the reported average credit is small. Other rules that interact with retirement income, such as the net investment income tax, apply separately from this credit.
Can you claim the credit and deduct the same IRA contribution?
Yes, one traditional IRA contribution can produce two results: a deduction that lowers taxable income and a Saver’s Credit on the same dollars. The deduction and the credit are computed under different Code sections (Section 219 for the deduction, Section 25B for the credit), so a single contribution can factor into both, subject to the eligibility rules for each (Source: IRC Section 25B; IRS Form 8880 instructions).
For instance, a $2,000 deductible traditional IRA contribution in the 12% bracket can reduce tax through the deduction and, if AGI is low enough, also produce a credit on the same $2,000. Which credit rate applies depends on the filer’s AGI and the 2026 breakpoints in the table above.
How do you claim the Saver’s Credit on Form 8880?
You claim the 2026 Saver’s Credit on Form 8880, Credit for Qualified Retirement Savings Contributions, and attach it to Form 1040, 1040-SR, or 1040-NR, carrying the result through Schedule 3 (Form 1040) (Source: IRS About Form 8880; IRS Tax Topic 610).
- Confirm you meet the age, student, and dependent tests and that your 2026 AGI is under the limit for your filing status.
- Total your eligible contributions (up to $2,000 per person), then subtract any testing-period distributions.
- Complete Form 8880 to find your rate and tentative credit.
- Carry the amount to Schedule 3, then to your Form 1040, 1040-SR, or 1040-NR.
- File by the deadline, described in the next section.
What are the contribution deadlines for the 2026 credit?
Timing depends on the account. IRA contributions for the 2026 tax year can generally be made through the April 2027 filing deadline, while workplace deferrals to a 401(k), 403(b), 457(b), or the TSP generally must be made through payroll by December 31, 2026 (Source: IRS, Retirement Savings Contributions Credit; IRS Tax Topic 610). Only the first $2,000 per person counts toward the credit.
The 2026 IRA contribution limit is $7,500, plus an $1,100 catch-up at age 50 or older, and the 2026 401(k) and 403(b) elective deferral limit is $24,500 (Source: IRS Notice 2025-67), though only the first $2,000 per person feeds the credit. Because year-end timing also affects strategies such as a Roth conversion deadline, savers often plan account moves before December 31.
Is the Saver’s Credit going away in 2027?
For retirement contributions, the Saver’s Credit is largely replaced starting with 2027 tax returns by a federal Saver’s Match. Created by the SECURE 2.0 Act of 2022 and codified at IRC Section 6433, the Match is a 50% federal contribution on up to $2,000 of retirement contributions per person, a maximum of $1,000, deposited into a retirement account rather than reducing a tax bill (Source: IRC Section 6433; CRS Report IF11159).
The Match differs in two ways: it is deposited into a retirement account instead of lowering a tax bill, and it is not capped at income tax liability, so lower earners who could not use the nonrefundable credit can still receive it. The full 50% match applies at lower incomes and phases down as income rises (Source: CRS Report IF11159).
The credit does not fully disappear. Under P.L. 119-21, the Saver’s Credit for a designated beneficiary’s contributions to their own ABLE account is made permanent, so from 2027 onward Form 8880 still applies to the ABLE-contribution credit while a separate process handles the retirement Saver’s Match (Source: IRS Form 8880 instructions; CRS Report IF11159).
Work with Q3 Advisors
Q3 Advisors is a registered investment adviser focused on retirement tax planning. This page is educational and is not advice; consult a qualified professional.
Frequently asked questions
What are the income limits for the Saver’s Credit in 2026?
For 2026, the maximum AGI to receive any Saver’s Credit is $80,500 for married filing jointly, $60,375 for head of household, and $40,250 for single, married filing separately, or qualifying surviving spouse filers, per IRS Notice 2025-67. The 50% rate applies up to $48,500 MFJ, $36,375 HoH, and $24,250 for other filers, with 20% and 10% bands above those figures.
How much is the Saver’s Credit worth?
For 2026, the Saver’s Credit is worth 50%, 20%, or 10% of up to $2,000 in eligible contributions per person ($4,000 for a married couple filing jointly). The maximum is $1,000 per person, or $2,000 for a couple both at the 50% rate. At the 20% rate the maximum is $400 per person, and at 10% it is $200 per person (Source: IRS Notice 2025-67).
Who qualifies for the Saver’s Credit?
To qualify for 2026, a taxpayer generally must be age 18 or older, not a full-time student, and not claimed as a dependent on another return, with AGI under the 2026 limit for their filing status and an eligible retirement or ABLE contribution (Source: IRS, Retirement Savings Contributions Credit). A person counts as a student if enrolled full time for any part of five calendar months during the year.
What contributions count for the Saver’s Credit?
Eligible contributions include traditional and Roth IRA contributions, elective deferrals to a 401(k), 403(b), governmental 457(b), SEP, SIMPLE, or the federal TSP, voluntary after-tax contributions to a qualified plan, and ABLE account contributions by the designated beneficiary. Rollover contributions and employer contributions, including matching contributions, do not count (Source: IRS Form 8880 instructions).
Is the Saver’s Credit refundable?
No. The Saver’s Credit is nonrefundable, meaning it can reduce income tax to zero but cannot generate a refund beyond your tax liability. Lower earners who owe little tax often cannot use the full amount computed on Form 8880, and any unused portion does not carry forward to another year (Source: CRS Report IF11159; IRS Form 8880 instructions).
How do I claim the Saver’s Credit on Form 8880?
You claim it on Form 8880, Credit for Qualified Retirement Savings Contributions, which attaches to Form 1040, 1040-SR, or 1040-NR and flows through Schedule 3. Total eligible contributions (up to $2,000 per person), subtract any testing-period distributions, find your rate, and carry the credit to Schedule 3 and then your return (Source: IRS About Form 8880; IRS Tax Topic 610).
Do 401(k) contributions count for the Saver’s Credit?
Yes. Your own elective deferrals to a 401(k), 403(b), governmental 457(b), SEP, SIMPLE, or the TSP count toward the Saver’s Credit, up to the $2,000 per person cap. Employer matching contributions do not count, because they are not your own voluntary contributions (Source: IRS Form 8880 instructions, Line 2).
Is the Saver’s Credit going away in 2027?
For retirement contributions, the credit is largely replaced starting with 2027 tax returns by the federal Saver’s Match under IRC Section 6433, a 50% deposit into a retirement account of up to $1,000. The Saver’s Credit itself continues for ABLE account contributions, which P.L. 119-21 made permanent (Source: IRC Section 6433; IRS Form 8880 instructions; CRS Report IF11159).
Sources
IRS, Retirement Savings Contributions Credit (Saver’s Credit): https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-savings-contributions-credit-savers-credit
IRS Tax Topic No. 610, Retirement Savings Contributions Credit: https://www.irs.gov/taxtopics/tc610
IRS, About Form 8880: https://www.irs.gov/forms-pubs/about-form-8880
IRS, Form 8880 and Instructions: https://www.irs.gov/pub/irs-pdf/f8880.pdf
IRS Notice 2025-67, 2026 Amounts Relating to Retirement Plans and IRAs: https://www.irs.gov/pub/irs-drop/n-25-67.pdf
Congressional Research Service, Report IF11159, The Retirement Savings Contributions Credit and the Saver’s Match: https://www.congress.gov/crs-product/IF11159
IRC Section 25B: https://www.law.cornell.edu/uscode/text/26/25B | IRC Section 6433: https://www.law.cornell.edu/uscode/text/26/6433
