Note: Any retirement credit that is more than the tax liability may not be carried back or forward.
A. Taxpayers Age 65 or Older as of December 31, 2013
Each taxpayer (you, and/or your spouse if filing jointly) age 65 or older at the end of 2013, may be allowed a retirement credit of up to $450. This credit is limited by the total of your modified adjusted gross income, nontaxable interest income, and any additions reported on TC-40A, Part 1.
B. Taxpayers under Age 65 who were born before January 1, 1953
Each taxpayer (you, and/or your spouse if filing jointly) under age 65 at the end of 2013 and born before January 1, 1953, who received eligible retirement income, may qualify for a credit up to $288, but not more than 6% of the qualifying income. The credit is limited by the total of your modified adjusted gross income, nontaxable interest income, and any additions to income reported on TC-40A, part 1.
Note: The retirement credit is phased-out when modified adjusted gross income exceeds certain amounts based on filing status.
Qualifying income is pensions, annuities or taxable retirement social security benefits. To claim the credit you must have earned the qualifying income. You cannot use pension, annuity or social security income of your spouse as your qualified income.
The following are retirement income:
- Amounts paid from an annuity contract bought under a plan your employer contributed to and you cannot revoke under IRC Section 404(a)(2);
- Amounts purchased by an employee under a plan that meets the requirements of IRC Section 408 (IRA plans);
- Amounts paid by the United States, a state thereof, or the District of Columbia; and
- Taxable retirement social security benefits (excluding survivor benefits), only if included in your federal adjusted gross income.
Income That Does Not Qualify
- Disbursements from deferred compensation plans, such as Section 401(k) and Section 457 plans; and
- Social security survivor benefits a child received on behalf of a deceased employee.