When President Donald Trump highlighted the Saver’s Credit in his State of the Union address, he drew attention to one of the quieter provisions in the tax code. It rarely commands headlines, yet for eligible households, it can reduce federal income taxes by as much as $2,000 each year.
The Current Structure: 2025 and 2026
Under the rules in effect for 2025 and 2026, the Saver’s Credit allows taxpayers to claim a credit equal to 50 percent, 20 percent, or 10 percent of up to $2,000 in qualifying retirement contributions per person. For married couples filing jointly, up to $4,000 in contributions can be counted toward the calculation, producing a maximum $2,000 credit.
Li Li
Author
Li Li, CFA, CIPM, CFP®, is an adjunct professor in the M.S. in Financial Planning program at New York University and a wealth management advisor at Forest Hill Financial Group. She studied economics at Rutgers University and the University of California–San Diego, has taught economics at Pace University, and previously served as a strategist and analyst at AT&T. She can be reached at [email protected]
