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Old 03-28-2014, 10:26 PM
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Retirement Savings Credit Question

Me(Erin) and my husband(Jason) are filing our taxes jointly through TurboTax. We got to the portion of the Retirement Savings Credit, and I am slightly confused.
My husband contributes to his 401K through his job, and I am a homemaker and do not contribute to any type of retirement account.
In 2012, I withdrew 20,000+ from my 401K with a previous employer.
There are 4 seperate questions during this section, they are as follows:
Did Jason contribute to an IRA or other qualified retirement account during 2013? YES
Did Erin contribute to an IRA or other qualified retirement account during 2013? NO
Did Jason take any funds from an IRA or other qualified retirement account between 2010 and prior to the tax deadline in 2013? NO
Did Erin take any funds from an IRA or other qualified retirement account between 2010 and prior to the tax deadline in 2013? YES
During the first 3 questions, we are shown to qualify for the tax credit, but after answering the last question, we lose the credit.
We paid all applicable taxes for the 401K withdrawal in 2013, both retirement accounts are in our own individual names, and nothing was taken out DURING 2013.
My questions are:
How and why does my withdrawal in 2012 affect our Retirement Savings Credit?
Should I be answering NO to the last question since the 401K that qualifies for the credit in not the one I withdrew from?
Thank You,
Erin



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Old 03-29-2014, 02:53 PM
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Join Date: Oct 2010
Posts: 5,207
Quote:
Originally Posted by Erin1986 View Post
Me(Erin) and my husband(Jason) are filing our taxes jointly through TurboTax. We got to the portion of the Retirement Savings Credit, and I am slightly confused.
My husband contributes to his 401K through his job, and I am a homemaker and do not contribute to any type of retirement account.
In 2012, I withdrew 20,000+ from my 401K with a previous employer.
There are 4 seperate questions during this section, they are as follows:
Did Jason contribute to an IRA or other qualified retirement account during 2013? YES
Did Erin contribute to an IRA or other qualified retirement account during 2013? NO
Did Jason take any funds from an IRA or other qualified retirement account between 2010 and prior to the tax deadline in 2013? NO
Did Erin take any funds from an IRA or other qualified retirement account between 2010 and prior to the tax deadline in 2013? YES
During the first 3 questions, we are shown to qualify for the tax credit, but after answering the last question, we lose the credit.
We paid all applicable taxes for the 401K withdrawal in 2013, both retirement accounts are in our own individual names, and nothing was taken out DURING 2013.
My questions are:
How and why does my withdrawal in 2012 affect our Retirement Savings Credit?
Should I be answering NO to the last question since the 401K that qualifies for the credit in not the one I withdrew from?
Thank You,
Erin
I guess you did not contribute money to a retirement plan in 2013.; in general, you’re disqualified if you didn’t contribute money to a retirement plan . alsoThere are income limits for this credit, depending on your filing status. I mean The Credit is limited by your AGI.



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