Back in 2022, the Secure Act 2.0 was passed and made numerous changes in retirement plans and individual retirement plans, included in the over 90 provisions, there was a Saver’s credit to be applicable from 2027. The interesting part about this provision is that from 2027, “… by making annual contributions of up to $2,000 to a 401(k)-type plan or an Individual Retirement Account (IRA), an individual can receive as much as an annual $1,000 Saver’s Match contribution from the Treasury.”
The existing Saver’s match is a non refundable tax credit but the future expansion will allow an increase of the retirement funds from those taxpayers that meet the income requirements (joint filers less than $41,000 – phasing out at $71,000 / single filers less than $20,500 – phasing out at $35,500).
In the IR-2024-232, the Treasury and IRS requested comments as there are several sections to be finalized to improve the retirement for low and moderate income individuals. We will keep you updated on future developments.
Link Pew – Federal Saver’s Match Could Benefit Millions of Low- to Moderate-Income Americans
Link Journal of Accountancy – IRS seeks comments on SECURE 2.0 saver’s match contributions
Link IRS – Treasury and IRS request comments on issues related to Saver’s Match contributions
