Citi Benefits Handbook
Tax Credit
Depending on your income, you may be eligible to reduce the federal income tax on a distribution through a tax credit based on a portion of your contributions (Before-Tax and/or Roth After-Tax Contributions) to the Plan. The credit for 2016 is:
  • 50% of the first $2,000 contributed to the Plan by an individual participant ($4,000 for married participants, filing jointly) with Adjusted Gross Income (AGI) of $18,500 or less ($37,000 if married and filing jointly);
  • 20% of the first $2,000 for individuals ($4,000 for married participants, filing jointly) with AGI between $18,501 and $20,000 ($37,001 and $40,000 if married and filing jointly); and
  • 10% of the first $2,000 for individuals ($4,000 for married participants, filing jointly) with AGI between $20,001 and $30,750 ($40,001 and $61,500 if married and filing jointly).
To claim the credit, you must complete IRS Form 8880 and attach it to your Form 1040A or Form 1040. Tax laws change from time to time, and the tax impact of receiving payments from the Plan will vary with your individual situation and when you receive the distribution. Because the Company does not give tax advice or counsel, you should consult a professional tax adviser or financial expert for advice about your circumstances.