The retirement savers’ tax credit is a bonus for people with modest incomes. Thinkstock By Kimberly Lankford, Contributing Editor February 2, 2015 What is the income limit to claim the retirement savers’ credit? My daughter’s income is less than $30,000, but I thought I read that adjusted gross income had to be less than $18,000 to claim the credit.This is a good time to ask about the retirement savers’ tax credit because it’s a tax break that many people overlook. (See our list of the 24 Most Overlooked Tax Deductions for more.) If you’re single and your adjusted gross income was less than $30,000 in 2014 (or $60,000 if married filing jointly), you can get an extra tax break if you contributed to an IRA, 401(k), 403(b), 457, Thrift Savings Plan, SEP or other retirement-savings plan. That break is in addition to any pretax or tax-deductible benefits you already received for the contribution. TOOL: Retirement Savings Calculator The $30,000 you heard about is the maximum income that single filers can have and still qualify for the credit. But the amount of the credit varies based on actual income, and that’s where the $18,000 comes in. If your daughter earned $18,000 or less, her credit would be worth 50% of the amount of money she contributed to a retirement-savings plan (up to $2,000 in contributions counts toward the calculation, resulting in a maximum credit of $1,000.) If she earned $18,001 to $19,500, her credit would be worth 20% of her contribution (with a maximum credit of $400). And the credit drops to 10% of her contribution if she earned $19,501 to $30,000 (with a maximum credit of $200). Joint filers can count up to $4,000 in combined contributions ($2,000 each), with income limits for each level. The credit is worth up to 50% of their contributions if their joint income was less than $36,000 in 2014, 20% if they earned $36,001 to $39,000, and 10% if they earned $39,001 to $60,000. The income levels increase slightly for 2015 contributions. See this IRS fact sheet for more details about the income limits for both years. Your daughter must also meet a few other criteria to qualify for the break. She must be 18 or older and cannot be a full-time student or claimed as a dependent on another person’s return. For more information, see IRS Form 8880, Credit for Qualified Retirement Savings Contributions. Got a question? Ask Kim at email@example.com.