Married Couples Could Get Up to $2,000 in Free Retirement Money Under New IRS Rules

Married couples who qualify for a new federal retirement savings program could receive as much as $2,000 from the government if both spouses are eligible and contribute enough to their own retirement accounts.

The Saver's Match begins with contributions made for the 2027 tax year and generally replaces the existing Saver's Credit for retirement savings contributions. Instead of reducing a taxpayer's tax bill, the new program will generally send government money directly into an IRA or workplace account, which could matter for couples reviewing their retirement plan.

Couples need to save $4,000 to get the full $2,000

The Saver's Match applies separately to each eligible individual, including spouses filing a joint tax return. Each person can receive a government match equal to as much as 50% of up to $2,000 in qualified retirement contributions. That means the maximum federal contribution is $1,000 per person.

For a married couple, the math could look like this. One spouse contributes $2,000 and qualifies for a 50% match, producing a $1,000 government contribution. The other spouse also contributes $2,000 and receives another $1,000.

Together, the couple would put $4,000 of their own money into retirement accounts and potentially receive another $2,000 from the government, bringing the combined amount added to their accounts to $6,000.

In effect, the government could add 50% to the first $2,000 contributed by each spouse, or $4,000 combined.

Your income determines the match percentage

Qualifying for the program doesn't automatically mean receiving the full $2,000. For 2027, married couples filing jointly can qualify for the maximum 50% matching rate when their modified adjusted gross income, or MAGI, is $41,000 or less.

Above that amount, the match percentage gradually declines as income rises. Once joint MAGI reaches $71,000, the Saver's Match drops to zero.

The Saver's Match is different from today's tax credit

One of the biggest changes is where the benefit goes, as the existing Saver's Credit is nonrefundable and may provide less value to people who owe little or no federal income tax.

The Saver's Match works differently. Instead of primarily reducing a tax bill, the federal government will generally deposit the match into an eligible retirement account designated by the taxpayer. Eligible savers can therefore receive the match even if they have little or no federal income tax liability.

That could make the program more valuable to lower-income workers who may not have received the full benefit of the existing credit.

IRS says the Saver's Match is to make retirement saving easier

One analysis found that, for workers eligible when the program begins, the Saver's Match could increase their account balance-to-salary ratio at age 65 by as much as 21.4% to 33.7%, depending on filing status, eligibility, and assumptions about saving behavior.

IRS Chief Executive Officer Frank Bisignano said in a statement that the program is intended to make retirement saving "easier and more rewarding" for millions of low- and moderate-income Americans.

Not everyone who meets the income limit qualifies

Income isn't the only requirement couples need to consider. An eligible individual generally must be at least 18 by the end of the tax year, can't be claimed as another taxpayer's dependent, and can't be a student under the program's definition. Certain nonresident aliens are also excluded unless they elect to be treated as U.S. residents.

Certain retirement distributions can also reduce the amount of contributions eligible for the match under the program's anti-abuse rules. That means someone who withdraws money from a retirement account around the same period may not receive a match based on the full amount they later contribute.

Joint filers should also remember that the income test is based on their combined modified adjusted gross income (MAGI) when determining each spouse's match percentage. They don't each receive a separate $71,000 income threshold.

Someone close to a phaseout threshold may therefore want to understand how the Saver's Match definition of MAGI applies to their situation before assuming they'll receive a particular amount.

Which retirement accounts can qualify?

Qualified contributions include money placed into traditional and Roth IRAs, 401(k) plans, 403(b) plans, and certain other workplace retirement accounts.

The IRS says taxpayers will claim the benefit using a new Form 8880-A and provide information including filing status, MAGI, qualified contributions, and instructions for where the government contribution should be sent.

The money won't necessarily arrive in 2027

The Saver's Match applies to qualifying retirement contributions beginning with the 2027 tax year. Taxpayers would generally claim the benefit when filing their 2027 federal income-tax returns in 2028.

The IRS is still developing the mechanics for delivering payments to eligible accounts, including IRAs and employer-sponsored retirement plans, so the match won't necessarily reach those accounts during 2027 itself.

Bottom line

Qualifying married couples who contribute at least $2,000 per spouse, or $4,000 combined, could receive as much as $2,000 in federal retirement contributions under the Saver's Match.

The program doesn't begin until 2027, and the IRS is still finalizing how payments will be routed. However, couples who expect to qualify may want to understand the rules now so they can decide whether increasing retirement contributions could help them get ahead financially and prepare for retirement.

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