The IRS announced a program that will offer a match of up to $1,000 per year for retirement contributions for some tax filers. Here’s how it will work.
WASHINGTON — The Internal Revenue Service said it is rolling out a program next year where lower- and moderate-income tax filers could receive up to $1,000 a year toward their retirement plan.
The IRS sent out CP321J notices to some taxpayers about their potential eligibility for the new Saver’s Match federal program. The agency said those who claimed the Saver’s Credit on their 2025 tax return or whose 2025 income was in the eligibility range received the notice.
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What is the Saver’s Match program?
The IRS said the Saver’s Match program is designed for people with low and moderate income. The federal government will match up to 50% of a person’s contribution toward their retirement account.
A person who’s eligible and contributes to a retirement plan or Individual Retirement Account (IRA) can claim the Saver’s Match when filing their 2027 federal tax return in 2028.
The program is set to begin in 2027 and will replace the Saver’s Credit program, where people could take a tax credit for making eligible contributions to their IRA or retirement plan. The IRS said contributions to ABLE accounts could still be eligible for the Saver’s Credit.
Under the Saver’s Match program, a match of up to $1,000 per person each year will be deposited directly into a person’s designated retirement account. If a married couple is filing jointly, the match applies to each spouse.
Who qualifies for the Saver’s Match program?
To qualify for the Saver’s Match program, a person must meet the following requirements:
— Make contributions to your retirement plan or IRA (there is no minimum amount).
— Be 18 years old at the end of the tax year.
— Not be claimed as a dependent on another person’s return.
— Be a U.S. resident for tax purposes.
A person’s modified adjusted gross income and filing status could affect whether they qualify and what percentage match they would receive.
The IRS published a table showing Saver’s Match rates based on filing status and modified adjusted gross income. The federal government will match the full 50% for the following:
— Married couple filing jointly/qualifying surviving spouse with a MAGI up to $41,000
— Head of household with a MAGI up to $30,750
— Single/Married couple filing separately with a MAGI up to $20,500
Those making more may receive a partial match or none. The income limits will be adjusted for inflation in years after 2027.
The IRS said the person eligible for the program does not need to do anything to prepare. The Saver’s Match will apply to retirement contributions made starting next year.