Save and Be Credited
If you are legally single and your 2017 adjusted gross income is of $31,500 or less, you can use the Saver’s Tax Credit to get even more benefits on your retirement contributions. This option is also available for married couples with an AGI of $63,000 or less.
Basically, this system allows you to claim a tax credit worth 10% to 50% of the amount you put in. The maximum credit limitation is of $1,000 (or $2,000 for joint filers). What’s even better is that workplace plan contributions like the 401(k), Roth or SEP IRA, are also eligible for this type of credit.
To put it in a simple manner, the lower your income, the higher the percentage you get with this credit.
