Save in a 401(k) or IRA on a modest income, and you can get back up to half of your first $2,000. Claim the Saver’s Credit on your return through tax year 2026. From tax year 2027, claim the Saver’s Match instead, and the money goes into your retirement account whether or not you owe tax.
If you’ve assumed retirement tax breaks are for high earners, this one gives the biggest percentage to the smallest incomes. Yet only 48% of U.S. workers know the Saver’s Credit exists, according to a 2025 survey by the Transamerica Center for Retirement Studies.
The credit has a catch the match removes. It’s worth 50%, 20%, or 10% of up to $2,000, depending on income, but it can’t exceed your federal income tax. The match starts at the same 50% and shrinks as income rises, but it doesn’t depend on what you owe.
At the top rate, $2,000 in an IRA earns the full $1,000 credit only if your federal income tax is at least that much. If you owe $600, the credit stops at $600. The match puts the full $1,000 in your account.
You qualify if you’re 18 or older, not a full-time student, not claimed as someone’s dependent, and under an income cap that’s adjusted for inflation. Each year’s Form 8880 lists the credit’s limits, and IRS.gov’s Saver’s Match page lists the match’s.
Your own contributions to a workplace plan like a 401(k) or 403(b), or to a traditional or Roth IRA, count. Rollovers don’t, and withdrawals from the past few years shrink what does. An IRA deposit made by the April filing deadline can still count for the prior year.
Neither version is automatic. You claim the credit on Form 8880, and while your W-2 reports 401(k) contributions, tax software only learns about an IRA contribution if you enter it. The match works the same way, starting with 2027 returns filed in 2028, and your return is where you choose the plan or IRA that receives it.
Treat it as a match you have to ask for. Put the money in, then make sure your return claims it.
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