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Saver's credit 8880

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Level 1
last updated ‎May 08, 2020 8:10 AM

MFJ, husband received IRA distribution from inherited IRA (from mother) and wife made 401K contribution, will they qualify for saver's credit? If Yes, how it's accomplished using Pro connect? Than you

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Level 15
Level 15
last updated ‎May 08, 2020 8:10 AM

Savers credit should calculate automatically if they qualify.


♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪
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Level 12
last updated ‎May 08, 2020 8:10 AM

Maybe, but probably not.

The distribution will restrict the Saver's Credit.  So unless the contribution is higher than the distributions in the last 3 years, there won't be a credit.  It does not matter if one spouse did the distribution and the other spouse did the contribution, it will still be restricted.

 

EDIT:  See comment below.

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Level 12
last updated ‎May 08, 2020 8:10 AM

WAIT, I'm wrong!

Inherited non-spousal IRA distributions do NOT affect it.

https://www.irs.gov/publications/p590a#en_US_2019_publink1000231197