The Federal Gov. uses Form 8880 to help those of low or moderate income save for retirement. This form is used to reduce your tax bill or increase your refund when you manage to put money away for your retirement, as an incentive of sorts, for doing so.
The saver’s credit can be claimed by:
•Married couples filing jointly with incomes up to $57,500 in 2012 or $59,000 in 2013;
•Heads of Household with incomes up to $43,125 in 2012 or $44,250 in 2013; and
•Married individuals filing separately and singles with incomes up to $28,750 in 2012 or $29,500 in 2013.
Because of the impact of other deductions and credits, the savers credit can be limited or even eliminated. But for those that manage to qualify, the max credit can be as high as $1000 for singles and $2000 for married couples.
Qualifications also depend on the following factors:
•Eligible taxpayers must be at least 18 years of age.
•Anyone claimed as a dependent on someone else’s return cannot take the credit.
•A student cannot take the credit. A person enrolled as a full-time student during any part of 5 calendar months during the year is considered a student.