More Than 21.9M People Will Qualify for Saver’s Match, EBRI Says

The Employee Benefit Research Institute estimates that at least 21.9 million workers will qualify for the Saver’s Match, created under the SECURE 2.0 Act of 2022.

The Saver’s Match is scheduled to begin being paid in 2027. It converts the Saver’s Credit, a tax credit for lower-income workers who contribute to a defined contribution plan or individual retirement account, into a federal government match. The match has a maximum value of $1,000 at a rate of $0.50 per dollar contributed by a worker.

Single workers making up to $20,000 qualify for the full amount, with the match amount gradually decreased in a phase-out range up to $35,000 in annual income. For married filers, those with combined income of up to $41,000 qualify for the full amount, with the phase-out range going up to $70,000. The match would be paid to eligible taxpayers’ retirement plan after the worker applied for it, according to the institute’s paper.

EBRI’s information is based on W-2 data published by the IRS and on data from the monthly Current Population Survey sponsored jointly by the U.S. Census Bureau and the U.S. Bureau of Labor Statistics. The most recent taxpayer data available is from tax year 2018, filed in 2019. Using tax data, EBRI found that about 83.8 million people would qualify. But because the provision applies to income from earnings, EBRI narrowed its consideration to households filing W-2s with qualifying amounts of income, which reduced the number of potentially eligible taxpayers to 69 million.

From there, EBRI used W-2 data on contributions to a defined contribution plan, a traditional IRA or a Roth IRA. When accounting for taxpayers who contributed to more than one account type, EBRI found that 18.9 million eligible workers had contributed to a DC plan, 2 million to a Roth IRA and 1 million to a traditional IRA, totaling 21.9 million people.

Those eligible who contribute to a Roth IRA can still claim the match but must receive the match into a traditional IRA, since the federal matching contribution would be made using pre-tax dollars.

EBRI cautioned that the true number of eligible participants today is likely higher, and the figure 21.9 million should be interpreted as a lower bound. Since the data used for the estimate is from 2018, the true figure in 2024, and in 2027 when the match comes into effect, likely is and will be higher.

The report also did not account for anyone who may qualify due to 1099 income or taxpayers at the highest ends of the phase-out ranges who would be receiving very small amounts as a match.