Retirement Savings Credit?
I just noticed this year that I got the Retirement Savings Credit. Now, I wouldn't have known this using the paper form I normally use. I found it out when I filed online. This makes me wonder.....since I wasn't aware of this last year, can I refile for 2006 and get the credit? And how would I go about doing this?
Public Comments
- Chances are you qualified for this credit last year and, possibly, in prior years. This money is yours for the taking. All you need to do is do an amended tax return for those years. You can not amend a tax return on-line. You will have to send the IRS a paper copy. The form is called a 1040X. In addition to filling it out, you will need to fill out the Form 8880 from the same year and send it along with the 1040X. Send each years in separate envelopes. You have until 4/15/08 to amend your 2004 tax return. You have until 4/15/09 to amend your 2005 tax return. After 4/15/08, any refund due to you for amending your 2004 tax return will be forfeited. To start, you need to collect all your tax paperwork for 2006 (and 2005 and 2004). You really only need the 1040 (or 1040A or 1040EZ) form. In addition, you need to know the total amount you (and your spouse) put into a qualified retirement plan (IRA, Roth, 401(k), 403(b), etc.) each year. Finally, you need to know how much money you withdrew from a qualified retirement plan and when. This goes against the credit. If you never took money out of a retirement plan, great! Borrowing against a 401(k) is not withdrawing the money unless you go into default. If you simply borrow money, you won't get a 1099-R. If you withdraw the money, you do. You also get 1099-R for other, non-disqualifying reasons such as rolling over money, so don't panic if you see a 1099-R. Then, you go to a qualified person to have the 1040X and 8880 prepared. I'm not well versed in TaxCut or TurboTax to know if they do a good job at preparing these forms. If so, go for it. If not, I might suggest going to see a professional because the 1040X isn't as easy to fill out as it could be. You can find all of these forms on the IRS web site at www.irs.gov.
