2021 Saver's Credit Income Limit
For 2021, the Saver's Credit Income Limit figures are $39,500 (Maximum AGI for the 50% credit rate, married taxpayers filing a joint return), $43,000 (Maximum AGI for the 20% credit rate, married taxpayers filing a joint return), $66,000 (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 | $39,500 | $29,625 | $19,750 |
| Maximum AGI for the 20% credit rate | $43,000 | $32,250 | $21,500 |
| Maximum AGI for the 10% credit rate | $66,000 | $49,500 | $33,000 |
Effective 2021-01-01Source: Notice 2020-79 (IRS)Verified 2026-09-03
Highest-tier applicable percentage, Middle-tier applicable percentage, Lowest non-zero-tier applicable percentageSource: United States Code (2021 edition), Title 26 Section 25B (Office of the Law Revision Counsel)Verified 2026-09-03
Maximum eligible contribution per personSource: Form 8880 (2021), Credit for Qualified Retirement Savings Contributions (IRS)Verified 2026-09-03
Compared with 2020
| Item | 2020 | 2021 | Change |
|---|---|---|---|
| Maximum AGI for the 50% credit rate, married taxpayers filing a joint return | $39,000 | $39,500 | +$500 (+1.3%) |
| Maximum AGI for the 20% credit rate, married taxpayers filing a joint return | $42,500 | $43,000 | +$500 (+1.2%) |
| Maximum AGI for the 10% credit rate, married taxpayers filing a joint return | $65,000 | $66,000 | +$1,000 (+1.5%) |
| Maximum AGI for the 50% credit rate, taxpayers filing as head of household | $29,250 | $29,625 | +$375 (+1.3%) |
| Maximum AGI for the 20% credit rate, taxpayers filing as head of household | $31,875 | $32,250 | +$375 (+1.2%) |
| Maximum AGI for the 10% credit rate, taxpayers filing as head of household | $48,750 | $49,500 | +$750 (+1.5%) |
| Maximum AGI for the 50% credit rate, all other taxpayers | $19,500 | $19,750 | +$250 (+1.3%) |
| Maximum AGI for the 20% credit rate, all other taxpayers | $21,250 | $21,500 | +$250 (+1.2%) |
| Maximum AGI for the 10% credit rate, all other taxpayers | $32,500 | $33,000 | +$500 (+1.5%) |
| 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
$19,750$66,000
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 contribute to a qualified retirement plan or IRA and claim the retirement savings contributions credit (Saver's Credit) under IRC § 25B for the 2021 tax year.
What changed this year, and why
The maximum adjusted gross income limits for the retirement savings contributions credit (Saver's Credit) are adjusted upward for 2021, effective January 1, 2021. For married taxpayers filing a joint return, the maximum AGI is $66,000, up from $65,000 in 2020. For taxpayers filing as head of household, the maximum AGI is $49,500, up from $48,750 in 2020. For all other taxpayers, the maximum AGI is $33,000, up from $32,500 in 2020. Taxpayers whose adjusted gross income exceeds these amounts are not eligible for the credit.
Common questions
- What is the retirement savings contributions credit (Saver's Credit)?
- The Saver's Credit is a tax credit for eligible taxpayers who make contributions to a retirement plan or IRA. The credit amount depends on the taxpayer's adjusted gross income, with lower incomes receiving a larger credit. The maximum adjusted gross income figures set the ceiling above which no credit is available.
- How did the 2021 income limits change compared to 2020?
- Yes. For 2021, the maximum AGI for married taxpayers filing jointly increased to $66,000 from $65,000 in 2020. For head of household, it increased to $49,500 from $48,750. For all other taxpayers, it increased to $33,000 from $32,500.
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 is below the maximum limit, three conditions can disqualify you from claiming this credit. You cannot take the credit if the person who made the contribution was born after January 1, 2004, was claimed as a dependent on someone else's tax return, or was a full-time student during the year. These rules apply to each individual separately, so if one spouse is disqualified, only that spouse's contributions are excluded from the credit calculation.
The person(s) who made the qualified contribution or elective deferral (a) was born after January 1, 2004; (b) is claimed as a dependent on someone else’s 2021 tax return; or (c) was a student (see instructions).
Form 8880 (2021), Credit for Qualified Retirement Savings Contributions (IRS)
The credit rate falls in steps as income rises
The credit rate is not fixed - it decreases in steps as your income rises. The IRS provides a table that assigns a decimal multiplier based on your adjusted gross income and filing status. For single filers, the highest rate applies when income is under $19,750, and the rate drops to zero once income reaches $33,000. For head of household filers, the highest rate holds longer, and the credit phases out entirely at $49,500. For married couples filing jointly, the top rate extends further still, and the credit disappears above $66,000. In between these thresholds, the rate falls through intermediate levels, with each bracket corresponding to a lower decimal amount. You multiply your eligible contributions by this decimal amount to calculate your preliminary credit before any tax-liability limitation applies.
Enter the applicable decimal amount from the table below. If line 8 is— Over— But not over— And your filing status is— Married filing jointly Head of household Enter on line 9— Single, Married filing separately, or Qualifying widow(er) --- $19,750
Form 8880 (2021), Credit for Qualified Retirement Savings Contributions (IRS)
Only the first $2,000 of contributions counts
Even if you made large retirement contributions, only a limited amount counts toward the Saver's Credit. The form caps the eligible contributions at $2,000 per person. If you are single, the maximum amount that can be used to calculate your credit is $2,000 regardless of how much you actually contributed. If you are married filing jointly, each spouse can count up to $2,000 of their own contributions. Contributions above these limits do not increase your credit. This cap applies after subtracting any recent distributions that reduce your eligible amount. If you contributed more than $2,000, only $2,000 is used in the credit calculation. If you contributed less than $2,000, your actual contribution amount is used because it falls below the cap.
In each column, enter the smaller of line 5 or $2,000 . . . . . . . . . . 6
Form 8880 (2021), Credit for Qualified Retirement Savings Contributions (IRS)
Recent withdrawals cut the contributions you can count
If you withdrew money from a retirement account in the years leading up to your credit claim, those withdrawals reduce the contributions that count for the Saver's Credit. The form requires you to report distributions received after 2018 and before the due date of your 2021 tax return, including extensions. This look-back period covers withdrawals from IRAs, employer retirement plans, and similar accounts. The total of these distributions is subtracted from your total contributions for the year. If the distributions equal or exceed your contributions, your eligible amount becomes zero and you cannot claim the credit. This rule prevents taxpayers from taking money out of retirement accounts and then claiming a credit for new contributions as if they had genuinely increased their savings. For married couples filing jointly, both spouses' distributions are included.
Certain distributions received after 2018 and before the due date (including extensions) of your 2021 tax return (see instructions). If married filing jointly, include both spouses’ amounts in both columns. See instructions for an exception . . . 4
Form 8880 (2021), Credit for Qualified Retirement Savings Contributions (IRS)
The credit cannot exceed the tax you owe
The Saver's Credit is nonrefundable, meaning it can reduce the tax you owe to zero but cannot generate a refund on its own. After calculating your tentative credit by multiplying your eligible contributions by the applicable rate, you must compare that amount to your tax liability using the Credit Limit Worksheet. The worksheet determines how much tax you owe after accounting for other nonrefundable credits. Your final credit is the smaller of your tentative credit amount or your tax liability limit. If your tentative credit exceeds your tax liability, the excess is lost - you do not receive it as a refund. This limitation ensures the credit functions as a reduction of tax owed rather than a direct payment to the taxpayer.
Limitation based on tax liability. Enter the amount from the Credit Limit Worksheet in the instructions 11
Form 8880 (2021), Credit for Qualified Retirement Savings Contributions (IRS)
Being a student for even part of five months can disqualify you
For the 2021 tax year, you are treated as a student - and therefore barred from claiming the saver's credit - if you were a full-time student during any part of 5 calendar months of 2021. The five months do not have to be consecutive; even a single day in each of five separate calendar months is enough to disqualify you. Full-time status can come from enrollment at a technical, trade, or mechanical school, or from taking a full-time on-farm training course offered by a school or a state, county, or local government agency. On-the-job training, correspondence courses, and schools that offer courses only over the Internet do not count. If you meet this student test, you cannot take the credit regardless of how much you contributed or how low your income is. The income limits still apply as well - $33,000 for single filers, $49,500 for heads of household, and $66,000 for married couples filing jointly - so even non-students above those thresholds are also ineligible.
You were a student if during any part of 5 calendar months of 2021 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 (2021), Credit for Qualified Retirement Savings Contributions (IRS)
The form used, and where the credit lands on your return
For the 2021 tax year, you claim the saver's credit by completing Form 8880, Credit for Qualified Retirement Savings Contributions, and attaching it to your Form 1040, 1040-SR, or 1040-NR. The form walks you through the calculation: you report your retirement contributions, subtract certain distributions, and then apply a rate from an IRS table based on your adjusted gross income and filing status. The final credit amount - whichever is smaller between the calculated amount and the limitation based on your tax liability - is carried to Schedule 3 (Form 1040), line 4, where it flows onto your individual income tax return as a nonrefundable credit. This means the credit reduces the tax you owe but cannot generate a refund on its own. The income thresholds that govern eligibility are $33,000 for single filers, $49,500 for heads of household, and $66,000 for married couples filing jointly. If your AGI exceeds the limit for your filing status, you cannot take the credit at all.
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 . . . . . . . . . . . . . . . . . . . . . 12
Form 8880 (2021), Credit for Qualified Retirement Savings Contributions (IRS)
This credit stacks on top of the separate IRA deduction
For the 2021 tax year, the saver's credit is not reduced by - and does not interfere with - any separate deduction you may claim for traditional IRA contributions. The IRS states that this credit can be claimed in addition to any IRA deduction claimed on Schedule 1 (Form 1040), line 20. In other words, if you contribute to a traditional IRA and qualify for both a deduction and the saver's credit, you receive the full benefit of each. The deduction lowers your taxable income on your regular tax return, while the credit directly reduces your tax liability dollar for dollar (up to the amount you owe) through Schedule 3 (Form 1040), line 4. The two benefits stack; one does not limit or phase out the other. Of course, each has its own set of eligibility requirements. The saver's credit itself requires that your adjusted gross income stay within the applicable limits: $33,000 for single filers, $49,500 for heads of household, and $66,000 for married couples filing jointly. If your income is within those thresholds and you otherwise qualify, you can claim both the IRA deduction and the saver's credit on the same return.
TIP This credit can be claimed in addition to any IRA deduction claimed on Schedule 1 (Form 1040), line 20.
Form 8880 (2021), 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 2020-79 (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 $39,000 to $39,500; the limitation under § 25B(b)(1)(B) is increased from $42,500 to $43,000; and the limitation under §§ 25B(b)(1)(C) and 25B(b)(1)(D) is increased from $65,000 to $66,000.
- 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 $39,000 to $39,500; the limitation under § 25B(b)(1)(B) is increased from $42,500 to $43,000; and the limitation under §§ 25B(b)(1)(C) and 25B(b)(1)(D) is increased from $65,000 to $66,000.
- 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 $39,000 to $39,500; the limitation under § 25B(b)(1)(B) is increased from $42,500 to $43,000; and the limitation under §§ 25B(b)(1)(C) and 25B(b)(1)(D) is increased from $65,000 to $66,000.
- 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 $29,250 to $29,625; the limitation under § 25B(b)(1)(B) is increased from $31,875 to $32,250; and the limitation under §§ 25B(b)(1)(C) and 25B(b)(1)(D) is increased from $48,750 to $49,500.
- 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 $29,250 to $29,625; the limitation under § 25B(b)(1)(B) is increased from $31,875 to $32,250; and the limitation under §§ 25B(b)(1)(C) and 25B(b)(1)(D) is increased from $48,750 to $49,500.
- 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 $29,250 to $29,625; the limitation under § 25B(b)(1)(B) is increased from $31,875 to $32,250; and the limitation under §§ 25B(b)(1)(C) and 25B(b)(1)(D) is increased from $48,750 to $49,500.
- 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 $19,500 to $19,750; the limitation under § 25B(b)(1)(B) is increased from $21,250 to $21,500; and the limitation under §§ 25B(b)(1)(C) and 25B(b)(1)(D) is increased from $32,500 to $33,000.
- 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 $19,500 to $19,750; the limitation under § 25B(b)(1)(B) is increased from $21,250 to $21,500; and the limitation under §§ 25B(b)(1)(C) and 25B(b)(1)(D) is increased from $32,500 to $33,000.
- 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 $19,500 to $19,750; the limitation under § 25B(b)(1)(B) is increased from $21,250 to $21,500; and the limitation under §§ 25B(b)(1)(C) and 25B(b)(1)(D) is increased from $32,500 to $33,000.
United States Code (2021 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 (2021), Credit for Qualified Retirement Savings Contributions (IRS)
- Maximum eligible contribution per person
In each column, enter the smaller of line 5 or $2,000