Ready to give your clients some good news? The IRS, in an article published on November 22nd of this year, reminds low to moderate income taxpayers that save for retirement and earn a tax credit in 2024 at the same time!
Also known as the Saver’s Credit. This credit offsets a portion of the first $2000 contributed to an IRA, 401k, or similarly structured retirement programs. The maximum credit a qualifying individual can receive is $1000 or $2000 if married filing jointly. The Saver’s Credit will then be applied to the taxpayers refund or reduce the amount a taxpayer owes to the IRS.
The taxpayer attempting to claim this refund must be at least 18 years old, not a claimed dependent, or a full time student. Other eligibility factors are related to income and marital status:
There is still time for your clients to take advantage of this credit in time for the upcoming tax season. As long as they set-up or contribute to an existing IRA by April 15th, 2024 then they can take advantage of the Saver’s Credit on their 2023 tax return. However, if the taxpayer has a workplace retirement plan then they have until December 31st of 2023 to contribute $2000 in order to get the Saver’s Credit on their upcoming return.
A full list of qualifying retirement plans along with additional information can be found in Form 8880 on the IRS website.
Your clients choose you year after year because they trust your service and you get them the best refund possible. In the same way SeQwens is dedicated to providing the best tax practice management software on the market, ensuring the day to day operations of your tax business don’t get in the way of what’s important, making your clients delighted.
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