2020 Saver's Credit Income Limit
For 2020, the Saver's Credit Income Limit figures are $39,000 (Maximum AGI for the 50% credit rate, married taxpayers filing a joint return), $42,500 (Maximum AGI for the 20% credit rate, married taxpayers filing a joint return), $65,000 (Maximum AGI for the 10% credit rate, married taxpayers filing a joint return) and 10 more figures below.
| Item | Married taxpayers filing a joint return | Taxpayers filing as head of household | All other taxpayers |
|---|---|---|---|
| Maximum AGI for the 50% credit rate | $39,000 | $29,250 | $19,500 |
| Maximum AGI for the 20% credit rate | $42,500 | $31,875 | $21,250 |
| Maximum AGI for the 10% credit rate | $65,000 | $48,750 | $32,500 |
Effective 2020-01-01Source: Notice 2019-59 (IRS)Verified 2026-09-03
Highest-tier applicable percentage, Middle-tier applicable percentage, Lowest non-zero-tier applicable percentageSource: United States Code (2020 edition), Title 26 Section 25B (Office of the Law Revision Counsel)Verified 2026-09-03
Maximum eligible contribution per personSource: Form 8880 (2020), Credit for Qualified Retirement Savings Contributions (IRS)Verified 2026-09-03
Compared with 2019
| Item | 2019 | 2020 | Change |
|---|---|---|---|
| Maximum AGI for the 50% credit rate, married taxpayers filing a joint return | $38,500 | $39,000 | +$500 (+1.3%) |
| Maximum AGI for the 20% credit rate, married taxpayers filing a joint return | $41,500 | $42,500 | +$1,000 (+2.4%) |
| Maximum AGI for the 10% credit rate, married taxpayers filing a joint return | $64,000 | $65,000 | +$1,000 (+1.6%) |
| Maximum AGI for the 50% credit rate, taxpayers filing as head of household | $28,875 | $29,250 | +$375 (+1.3%) |
| Maximum AGI for the 20% credit rate, taxpayers filing as head of household | $31,125 | $31,875 | +$750 (+2.4%) |
| Maximum AGI for the 10% credit rate, taxpayers filing as head of household | $48,000 | $48,750 | +$750 (+1.6%) |
| Maximum AGI for the 50% credit rate, all other taxpayers | $19,250 | $19,500 | +$250 (+1.3%) |
| Maximum AGI for the 20% credit rate, all other taxpayers | $20,750 | $21,250 | +$500 (+2.4%) |
| Maximum AGI for the 10% credit rate, all other taxpayers | $32,000 | $32,500 | +$500 (+1.6%) |
| Highest-tier applicable percentage | 50% | 50% | +0% (+0.0%) |
| Middle-tier applicable percentage | 20% | 20% | +0% (+0.0%) |
| Lowest non-zero-tier applicable percentage | 10% | 10% | +0% (+0.0%) |
| Maximum eligible contribution per person | $2,000 | $2,000 | +$0 (+0.0%) |
Maximum AGI for the 50% credit rate
Maximum AGI for the 20% credit rate
Maximum AGI for the 10% credit rate
$19,500$65,000
One dot per column of the table, on a scale running from the smallest of these amounts to the largest. The scale is logarithmic, so that the amounts crowded at the low end stay far enough apart to read. The table states which dot is which.
Who it applies to
Taxpayers who claim the retirement savings contributions credit (Saver's Credit) for the 2020 tax year
What changed this year, and why
The adjusted gross income limits for the Saver's Credit (retirement savings contributions credit under IRC § 25B) were adjusted for inflation for 2020. The maximum AGI for married taxpayers filing a joint return is $65,000; for heads of household, $48,750; and for all other taxpayers, $32,500.
Common questions
- What happens if my income exceeds these limits?
- For 2020, the maximum adjusted gross income to claim the Saver's Credit is $65,000 for married taxpayers filing jointly, $48,750 for heads of household, and $32,500 for all other taxpayers. Taxpayers whose AGI exceeds the limit for their filing status cannot claim the credit.
Every amount on this page is a published figure rather than yours. The Saver's Credit calculator for a joint return takes the number you enter and works it out against them, showing which published figure it used.
Three things that disqualify you even under the income limit
Even if your income falls below the AGI limits, you cannot claim the Saver's Credit if any of three disqualifying conditions apply to you or the person who made the qualified contribution. First, you are ineligible if you were born after January 1, 2003, meaning you must be at least 18 years old by the end of the tax year. Second, you cannot take the credit if you are claimed as a dependent on someone else's 2020 tax return. Third, you are disqualified if you were a student during any part of five calendar months in 2020. Being a student means you were enrolled as a full-time student at a school, which includes technical, trade, and mechanical schools, or you took a full-time, on-farm training course given by a school or government agency. However, on-the-job training courses, correspondence schools, and schools offering courses only through the internet do not count. All three conditions must be avoided to qualify for the credit, regardless of whether your adjusted gross income is $32,500 or less, $48,750 or less for head of household, or $65,000 or less for married filing jointly.
The person(s) who made the qualified contribution or elective deferral (a) was born after January 1, 2003; (b) is claimed as a dependent on someone else’s 2020 tax return; or (c) was a student (see instructions).
Form 8880 (2020), Credit for Qualified Retirement Savings Contributions (IRS)
The credit rate falls in steps as income rises
The Saver's Credit rate is not a single flat percentage. Instead, it falls in tiers as a taxpayer's adjusted gross income rises. After determining eligible contributions on line 7, the taxpayer looks up an applicable decimal amount from a table on the form based on their income and filing status. The rate starts at the highest percentage for the lowest income levels, then drops through intermediate tiers and finally to zero once income exceeds the maximum thresholds. For 2020, the maximum adjusted gross income to qualify is $65,000 for married taxpayers filing jointly, $48,750 for heads of household, and $32,500 for all other taxpayers. At or above those ceilings the rate is zero and no credit is available. The tiered structure means that as income increases within each bracket, the percentage applied to contributions steadily declines until the credit disappears entirely.
Enter the applicable decimal amount from the table below.
Form 8880 (2020), Credit for Qualified Retirement Savings Contributions (IRS)
Only the first $2,000 of contributions counts
When figuring the Saver's Credit on Form 8880, you must first total your IRA and employer-plan contributions, then subtract certain recent distributions. Line 6 of the form instructs you: "In each column, enter the smaller of line 5 or $2,000." Line 5 is the result of subtracting recent distributions from your total contributions. This means the credit is computed on at most $2,000 of contributions per person, no matter how much you actually saved during the year. For a married couple filing jointly, each spouse has a separate column, so the household can count up to $2,000 for each spouse, for a combined maximum of $2,000 per column. If your net contributions after subtracting distributions are less than $2,000, that smaller amount is what gets multiplied by the credit rate. The cap ensures that the benefit is focused on moderate savers rather than scaling without limit for high contributors.
6 In each column, enter the smaller of line 5 or $2,000 . . . . . . . . . . 6
Form 8880 (2020), Credit for Qualified Retirement Savings Contributions (IRS)
Recent withdrawals cut the contributions you can count
The Saver's Credit is designed to encourage saving for retirement, not to reward taxpayers who have recently withdrawn funds. To address this, the form requires taxpayers to reduce their eligible contributions by certain distributions they received. Specifically, the taxpayer must subtract from their total contributions any distributions received after 2017 and before the due date (including extensions) of their 2020 tax return. If the result is zero or less, the taxpayer enters zero and cannot claim the credit. This lookback period covers roughly three years of withdrawals. For married couples filing jointly, both spouses' distributions must be included. The purpose is to ensure the credit reflects actual net savings rather than contributions that were quickly withdrawn.
Certain distributions received after 2017 and before the due date (including extensions) of your 2020 tax return
Form 8880 (2020), Credit for Qualified Retirement Savings Contributions (IRS)
The credit cannot exceed the tax you owe
The Saver's Credit is nonrefundable, meaning it cannot reduce a taxpayer's income tax below zero. The form calculates a preliminary credit amount on line 10 by multiplying eligible contributions by the applicable rate, but the final credit on line 12 is limited to the taxpayer's tax liability. The taxpayer must enter the amount from the Credit Limit Worksheet in the instructions on line 11, and the actual credit is the smaller of the preliminary credit or this tax limitation. If the preliminary credit exceeds the tax owed, the excess is lost; it is not refunded and cannot be carried to another year. This limitation ensures the credit can only offset tax that is actually owed, not create a refund on its own.
Limitation based on tax liability. Enter the amount from the Credit Limit Worksheet in the instructions
Form 8880 (2020), Credit for Qualified Retirement Savings Contributions (IRS)
Being a student for even part of five months can disqualify you
For 2020, a taxpayer is treated as a student - and is disqualified from the saver's credit - if, during any part of 5 calendar months of 2020, the person was either enrolled as a full-time student at a school or took a full-time on-farm training course given by a school or a state, county, or local government agency. The 5 months do not have to be consecutive; any part of a month counts, so even a brief period of full-time enrollment in each of five separate months is enough to block the credit for the entire year. The IRS definition of a school is broad: it includes technical, trade, and mechanical schools, but it does not include on-the-job training courses, correspondence schools, or schools that offer courses only through the internet. This student test applies to the individual who made the qualified retirement contribution or elective deferral, so on a joint return only the person who was the full-time student is barred; the other spouse may still claim the credit on his or her own qualifying contributions if all other eligibility rules are met.
You were a student if during any part of 5 calendar months of 2020 you: • Were enrolled as a full-time student at a school; or • Took a full-time, on-farm training course given by a school or a state, county, or local government agency. A school includes technical, trade, and mechanical schools. It doesn’t include on-the-job training courses, correspondence schools, or schools offering courses only through the Internet.
Form 8880 (2020), Credit for Qualified Retirement Savings Contributions (IRS)
The form used, and where the credit lands on your return
For the 2020 tax year, the retirement savings contributions credit is calculated on Form 8880 and then carried over to the taxpayer's main income tax return. The final credit amount is entered on Schedule 3 (Form 1040), line 4, which is the schedule used to report various nonrefundable credits. Because the credit is nonrefundable, it can reduce the taxpayer's federal income tax liability to zero but cannot create a refund by itself. Taxpayers should attach the completed Form 8880 to their Form 1040, 1040-SR, or 1040-NR when filing.
12 Credit for qualified retirement savings contributions. Enter the smaller of line 10 or line 11 here and on Schedule 3 (Form 1040), line 4
Form 8880 (2020), Credit for Qualified Retirement Savings Contributions (IRS)
This credit stacks on top of the separate IRA deduction
The saver's credit is designed to work alongside other tax benefits for retirement savers, not as a replacement for them. For 2020, the IRS explicitly states that the credit can be claimed in addition to any IRA deduction claimed on Schedule 1 (Form 1040), line 19. This means that if you make a deductible contribution to a traditional IRA, you can both reduce your adjusted gross income through the IRA deduction and then claim the saver's credit on top of that deduction, provided you meet the credit's income limits and other eligibility requirements. The two benefits are calculated independently: the IRA deduction lowers your taxable income, while the saver's credit directly reduces your tax liability as a nonrefundable credit. Taxpayers should not assume that claiming one benefit disqualifies them from the other; the IRS treats them as separate provisions that can stack to provide greater overall tax relief for retirement savings.
TIP This credit can be claimed in addition to any IRA deduction claimed on Schedule 1 (Form 1040), line 19.
Form 8880 (2020), Credit for Qualified Retirement Savings Contributions (IRS)
How each figure was verified
Each number below was read from a stored copy of the document named beside it, and checked to occur word for word in the quoted sentence. The digest is of that stored text.
Notice 2019-59 (IRS)
- Maximum AGI for the 50% credit rate, married taxpayers filing a joint return
The adjusted gross income limitation under § 25B(b)(1)(A) for determining the retirement savings contributions credit for married taxpayers filing a joint return is increased from $38,500 to $39,000; the limitation under § 25B(b)(1)(B) is increased from $41,500 to $42,500; and the limitation under §§ 25B(b)(1)(C) and 25B(b)(1)(D) is increased from $64,000 to $65,000.
- Maximum AGI for the 20% credit rate, married taxpayers filing a joint return
The adjusted gross income limitation under § 25B(b)(1)(A) for determining the retirement savings contributions credit for married taxpayers filing a joint return is increased from $38,500 to $39,000; the limitation under § 25B(b)(1)(B) is increased from $41,500 to $42,500; and the limitation under §§ 25B(b)(1)(C) and 25B(b)(1)(D) is increased from $64,000 to $65,000.
- Maximum AGI for the 10% credit rate, married taxpayers filing a joint return
The adjusted gross income limitation under § 25B(b)(1)(A) for determining the retirement savings contributions credit for married taxpayers filing a joint return is increased from $38,500 to $39,000; the limitation under § 25B(b)(1)(B) is increased from $41,500 to $42,500; and the limitation under §§ 25B(b)(1)(C) and 25B(b)(1)(D) is increased from $64,000 to $65,000.
- Maximum AGI for the 50% credit rate, taxpayers filing as head of household
The adjusted gross income limitation under § 25B(b)(1)(A) for determining the retirement savings contributions credit for taxpayers filing as head of household is increased from $28,875 to $29,250; the limitation under § 25B(b)(1)(B) is increased from $31,125 to $31,875; and the limitation under §§ 25B(b)(1)(C) and 25B(b)(1)(D) is increased from $48,000 to $48,750.
- Maximum AGI for the 20% credit rate, taxpayers filing as head of household
The adjusted gross income limitation under § 25B(b)(1)(A) for determining the retirement savings contributions credit for taxpayers filing as head of household is increased from $28,875 to $29,250; the limitation under § 25B(b)(1)(B) is increased from $31,125 to $31,875; and the limitation under §§ 25B(b)(1)(C) and 25B(b)(1)(D) is increased from $48,000 to $48,750.
- Maximum AGI for the 10% credit rate, taxpayers filing as head of household
The adjusted gross income limitation under § 25B(b)(1)(A) for determining the retirement savings contributions credit for taxpayers filing as head of household is increased from $28,875 to $29,250; the limitation under § 25B(b)(1)(B) is increased from $31,125 to $31,875; and the limitation under §§ 25B(b)(1)(C) and 25B(b)(1)(D) is increased from $48,000 to $48,750.
- Maximum AGI for the 50% credit rate, all other taxpayers
The adjusted gross income limitation under § 25B(b)(1)(A) for determining the retirement savings contributions credit for all other taxpayers is increased from $19,250 to $19,500; the limitation under § 25B(b)(1)(B) is increased from $20,750 to $21,250; and the limitation under §§ 25B(b)(1)(C) and 25B(b)(1)(D) is increased from $32,000 to $32,500.
- Maximum AGI for the 20% credit rate, all other taxpayers
The adjusted gross income limitation under § 25B(b)(1)(A) for determining the retirement savings contributions credit for all other taxpayers is increased from $19,250 to $19,500; the limitation under § 25B(b)(1)(B) is increased from $20,750 to $21,250; and the limitation under §§ 25B(b)(1)(C) and 25B(b)(1)(D) is increased from $32,000 to $32,500.
- Maximum AGI for the 10% credit rate, all other taxpayers
The adjusted gross income limitation under § 25B(b)(1)(A) for determining the retirement savings contributions credit for all other taxpayers is increased from $19,250 to $19,500; the limitation under § 25B(b)(1)(B) is increased from $20,750 to $21,250; and the limitation under §§ 25B(b)(1)(C) and 25B(b)(1)(D) is increased from $32,000 to $32,500.
United States Code (2020 edition), Title 26 Section 25B (Office of the Law Revision Counsel)
- Highest-tier applicable percentage
if the adjusted gross income of the tax- payer is not over $30,000, 50 percent,
- Middle-tier applicable percentage
if the adjusted gross income of the tax- payer is over $30,000 but not over $32,500, 20 percent,
- Lowest non-zero-tier applicable percentage
if the adjusted gross income of the tax- payer is over $32,500 but not over $50,000, 10 percent,
Form 8880 (2020), Credit for Qualified Retirement Savings Contributions (IRS)
- Maximum eligible contribution per person
In each column, enter the smaller of line 5 or $2,000