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Tax Credits
for Certain
Retirement Plan Participants
For
taxable years 2002 through 2006, you may be eligible to claim a
tax credit on your income tax return for contributions you make
to the University's Tax-Deferred Retirement Plan or Supplemental
Retirement Account. To be eligible, you must be at least 18 years
of age by the end of the year and meet certain income thresholds.
Full-time students and individuals who are claimed as dependents
on someone else's tax return are not eligible.
The
credit will apply to the amount you contributed up to $2,000, and
ranges from 10% to 50%, depending on your tax filing status and
gross income level, as shown in the table below. Both elective deferrals
and after-tax contributions are eligible for the credit.
Tax Credit(%
of amount contributed up to $2,000)
|
Adjusted
Gross Income Based on Filing Status
|
Joint Return
|
Head of Household
|
Single/Married
|
Filing Separately
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50%
|
Up to $30,000
|
Up to $22,500
|
Up to $15,000
|
20%
|
$30,001 to $32,500
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$22,501 to $24,375
|
$15,001 to $16,250
|
10%
|
$32,501 to $50,000
|
$24,376 to $37,500
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$16,251 to $25,000
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0%
|
Over $50,000
|
Over $37,500
|
Over $25,000
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Here
are some additional considerations regarding this tax credit:
1) Adjusted
gross income will have to be modified by adding in certain amounts
of income otherwise excluded from income tax such as certain income
from foreign sources.
2) Certain
plan distributions must be an offset against the tax credit.
3) The
credit will not reduce the taxes owed below the amount computed
under the alternative minimum tax, if applicable.
Because
of the complicated nature of the IRS provisions, it is suggested
that you consult with your accountant or tax advisor on issues affecting
your income tax return.
--Division
of Human Resources
Almanac, Vol. 48, No. 29, April 9, 2002
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ISSUE
HIGHLIGHTS:
Tuesday,
April 9, 2002
Volume 48 Number 29
www.upenn.edu/almanac/
It's once
again time to recognize excellence in teaching at Penn, with
the Lindback and Provost's Awards. And
the recipients are
. |
A
political science professor is appointed to a
term chair.
|
Four of
Penn's schools make the grade on the
top ten list of U.S. News graduate schools. |
Observations
on the experimental SAS
Pilot Curriculum, including insights, accomplishments and
challenges. |
An graphic
report on the University's
FY 2002 Budget, as reported to Council. |
Research
Roundup: a few of the many Penn projects and studies shed
light on interventions, risk-reductions, treatment strategies
and post-traumatic stress. |
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