The credit for retirement savings contributions is a nonrefundable tax
credit available to taxpayers who make eligible contributions
to a qualified IRA, 401(K), or certain other retirement plans.
The amount of the credit is a percentage of your eligible
contribution based on your filing status and modified adjusted
gross income. The maximum amount of credit is $1,000 per taxpayer
($2,000 married filing jointly).
If you received a distribution from any IRA, plan, or annuity
that qualifies as an eligible contribution in the current tax year,
previous two years, or before the due date of the current tax year
filing period, you must reduce the amount of your eligible
contribution by the amount of the distribution you received.
Distributions received by your spouse are treated as being
received by you if your filing status is married filing jointly in
the year the distribution was received and the year the
contribution was made.
The maximum amount of credit is 50% (per taxpayer) of the first
$2,000 of eligible contributions.
The credit is gradually reduced as your modified adjusted gross
income increases and is completely phased out when your modified
adjusted gross income exceeds the following amounts in the 2012 tax
To claim the credit, complete Form 8880 and attach the form to
your Form 1040 or Form 1040A.
information see IRS Publication 590.