CPAs know that tax refunds are the largest sums of money that some people will receive all year, so tax season is a great time to help people build their assets and start saving for retirement. They also likely know that millions of people do not have access to retirement savings plans at work. According to a 2015 Federal Reserve Report, 42% of workers who do not participate in 401(k) or other defined contribution plans say this is because their employers do not offer them.

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Now it’s easier than ever for savers to use their federal tax refunds to save for their futures with a new retirement savings account called myRA ( With myRA, tax filers can start saving for retirement and, if eligible, take advantage of the Saver’s Tax Credit. Individuals must also be age 18 or older, not a full-time student, and not be claimed as a dependent on another tax return to be eligible. Tax professionals are in a prime position to help clients determine which retirement savings options might be best for them. For those who lack retirement savings options, myRA could be a good place to start.

myRA: What It Is and Who Can Use It

myRA is a Roth IRA designed for people who do not have access to retirement savings plans through their jobs, such as small business employees, part-time and temporary workers, and the self-employed. myRA has no fees, poses no risk of losing money, and has no minimum balance or contribution requirements. Anyone looking for a simple, safe, and affordable option to start saving for retirement should consider opening a myRA account. myRA is not intended to replace existing retirement savings options including employer-sponsored retirement plans in which individuals may be eligible for employer matches, or other special incentives.

In addition, individuals with modified adjusted gross income below certain levels (for 2015, $61,000 if married filing jointly, $45,750 if head of household, $30,500 if single) may be eligible to claim a Saver’s Tax Credit for their contributions. The amount of the Saver’s Tax Credit can be 50%, 20%, or 10% of retirement contributions up to $2,000, depending on income and filing status.

With myRA, tax filers can start saving for retirement and, if eligible, take advantage of the Saver’s Tax Credit.

Contribution and Distribution: Where the Money Goes

For 2015 and 2016, people can contribute anywhere from a few dollars a month up to $5,500 per year, or $6,500 per year if the participant will be 50 years of age or older at the end of the year. Participants cannot contribute more than their earned income, and updated limits are announced annually by the IRS. Money in a myRA account continues to earn interest until the account reaches $15,000. At that time, the balance will roll over to a private-sector Roth IRA, where the account holder can continue to invest savings and make additional contributions. Account holders can also choose to roll over their myRA account balances into private-sector Roth IRAs at any time before then.

Money put into a myRA account is invested in a U.S. Treasury savings bond that safely earns interest at the same variable rate as investments in the Government Securities Fund for federal employees. These investments returned 2.31% in 2014 and had an average annual return of 3.19% over the 10-year period ending December 2014.

Account holders can withdraw their contributions at any time without paying tax and penalty. In addition, the interest earned on an account can be withdrawn without tax and penalty five years after the first contribution is made if the account holder is over age 59 1/2, or meets certain other conditions, such as using the funds for the purchase of a first home.

Helping Clients Start Saving with myRA

CPAs should educate their clients on myRA and the opportunity to save on their taxes while also saving for their futures. Free informational materials are available on In addition, tax filers can open or contribute to myRA accounts with their tax refunds. It takes only minutes to sign up at or by phone at 855-406-6972.

Richard Ludlow is the executive Director of the U.S. Treasury Department’s myRA Program.