8880 - Retirement Savings Contributions Credit

Form 8880 - Retirement Savings Contributions Credit

Enter information on screen 8880 in order for the software to calculate and produce the credit. When the form has not been produced, a notes page may advise you if the taxpayer might qualify for 8880 credit. Form 8880 will not generate unless an entry is made on screen 8880.

Beginning in Drake18, the Tax Cuts and Jobs Act has made ABLE account contributions eligible for the 8880 credit. If contributions do qualify, they will need to be manually entered on screen 8880 line 1. Rollover contributions (money that you moved from another ABLE account or from a Qualified Tuition Plan (QTP) account do not qualify for the credit. Also, your eligible contributions may be reduced by any recent distributions you received from your ABLE account.

Note: Line 1 is an override field. If the taxpayer had contributions from traditional IRAs or ROTH IRAs and ABLE accounts, you would need to total these amounts on line 1.

If the taxpayer made contributions to a 401(k), but did not make the contributions through their employer, you will have to manually enter the amount on line 2 of screen 8880.

Note: Line 2 is an override field. If the taxpayer had contributions both through and not through their employer, you would need to enter the total of both contributions on line 2.

 AGI Limits  MFJ  HOH  Other*
2023 $73,000  $54,750 $36,500
2022 $68,000  $51,000 $34,000
2021 $66,000 $49,500 $33,000 
$65,000 $48,750
2019 $64,000 $48,000 $32,000
2018 $63,000 $47,250 $31,500
2017 $62,000 $46,500 $31,000
2016 $61,500 $46,125 $30,750
2015 $61,000 $45,750 $30,500

 *Single, married filing separately, or qualifying surviving spouse (widow(er))

Removing the Credit:

Once the form has been generated, if there is an IRA or 401(k) contribution elsewhere in the software flowing to the 8880, the 8880 is treated as an affirmative statement by the taxpayer even if it has blank fields (which are read as “zero” entries). You must delete screen 8880 to clear the form and remove the entry. This does not eliminate Form 8880 if it is generated due to an IRA or 401(k) contribution shown elsewhere in the return, but clears the entries you made on screen 8880.

Additional resources: