Tax savers credit.

[gman]

Does TRS(teachers retirement) contribution qualify for the tax savers credit?

[TaxGuyBill]

I don't think so.

It might vary by state, but I think teacher's retirement contributions are mandatory. The Saver's Credit is only for "elective deferrals" and "voluntary employee contributions" for certain types of retirement plans.

http://www.law.cornell.edu/uscode/text/26/25B#d

[gman]

Trs

I dont think it does either, but I cannot find any information on it. Any help??

[FEDUKE404]

If all else fails. . .

...read the relevant instructions.

From Form 8880 instructions ( http://www.irs.gov/pub/irs-pdf/f8880.pdf )

Line 2

Include on line 2 any of the following amounts.
• Elective deferrals to a 401(k) or 403(b) plan (including designated Roth contributions under section 402A), or to a governmental 457, SEP, or SIMPLE plan.
• Voluntary employee contributions to a qualified retirement plan as defined in section 4974(c) (including the federal Thrift Savings Plan).
• Contributions to a 501(c)(18)(D) plan.

These amounts may be shown in box 12 of your Form(s) W-2 for 2013.

Note. Contributions designated under section 414(h)(2) are treated as employer contributions and as such they are not voluntary contributions made by the employee. They do not qualify for the credit and should not be included on line 2.

Here is a related discussion:

http://www.taxalmanac.org/index.php/Discussion:Teachers_Retirement_System_(TRS)_and_the_Credit_for_Qualified_Retirement_Savings_Contributions

FE

[ddoshan]

Note. Contributions designated under section 414(h)(2) are treated as employer contributions and as such they are not voluntary contributions made by the employee. They do not qualify for the credit and should not be included on line 2.

When someone retires and starts drawing on their company pension which is based on employer contributions, years of service, etc. does that count as a distribution from a retirement plan therefore negating a possible Savers Credit? I know our software will not allow a Savers Credit when one spouse receives a 1099R from their Company retirement pension such as say from Ford Motor Co. Yet the other spouse may have contributed to their 401K or put money into an IRA. I didn't think the company pension would count against it.
I can recall in the past where I could make an entry to reverse the Co. pension from showing up on the form 8880. But I don't see that option anymore.

[Black Bart]

Dosh,

Note. Contributions designated under section 414(h)(2) are treated as employer contributions and as such they are not voluntary contributions made by the employee. They do not qualify for the credit and should not be included on line 2.

When someone retires and starts drawing on their company pension which is based on employer contributions, years of service, etc. does that count as a distribution from a retirement plan therefore negating a possible Savers Credit? I know our software will not allow a Savers Credit when one spouse receives a 1099R from their Company retirement pension such as say from Ford Motor Co. Yet the other spouse may have contributed to their 401K or put money into an IRA. I didn't think the company pension would count against it.
I can recall in the past where I could make an entry to reverse the Co. pension from showing up on the form 8880. But I don't see that option anymore.

I agree with you about the teachers' retirement not qualifying. Our teachers' contributions here (mostly 403-B) are also mandatory and not "elective/voluntary."
But I don't think you're right about the spouse's company pension not reducing the credit. Look at line four on the 8880 (certain distributions) and in the second sentence it says "If married filing jointly, include both spouses' amounts in both columns. See instructions for an exception." The exception is that if they did not file jointly in any of the affected years (2011-2012-2013 in this case), then the other spouse's withdrawal made in the filed separately year would not count.

[ddoshan]

I understand that when MFJ they are treated as one for the savers credit. I thought, not sure, that say one spouses company retirement pension should even count as a distribution and therefore negate a savers credit. If it is not a distribution from a retirement account such as a 401K or an IRA or such retirement accounts, I thought you did not have to include these as distributions. Yet our program does automatically transfer them to the 8880 as distributions taken.

I know that several years ago my wife received a retirement pension from where she worked. Strictly a company pension based on years of service to which she never contributed. I contributed to an IRA each year and took the savers credit. I recall making an entry on inputting form 8880 that reversed her retirement pension so it did not show up as a distribution negating my IRA. Maybe I was doing something wrong. But I don't see that option anymore.