Man with $59,000 AGI, he contributed $5,500 to his traditional IRA. No distributions taken. What is...

Man with $59,000 AGI, he contributed $5,500 to his traditional IRA. No distributions taken. What is their savers credit?

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Expert Solution

As per law, an individual is eligible for making eligible contributions within IRA, the percentage of tax credit depends on the AGI of the individual and the status in which the individual is filing the return.

Credit Rate	Married Individual Filing Jointly	Head of Household	All Other Filers
50 percent of individual contribution	AGI not more than $38,500	AGI not more than $28,875	AGI not more than $19,250
20 percent of individual contribution	$38,501 to $41,500	$28,876 to $31,125	$19,251 to $20,750
10 percent of individual's contribution	$41,501 to $64,000	$31,126 to $48,000	$20,751 to $32,000
0 percent of individual's contribution	more than $64,000	more than $48,000	more than $32,000

Based on the information provided in the question, it can be seen that that the total AGI of the individual is more than $32,000 and is not filing jointly, hence he is eligible for 0% savers credit based on the rules of 2019. Thus, the man would not be able to get any tax credit from the contributions made in the IRA.

jeff jeffy answered 4 months ago

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