If you contribute to a retirement account, either one you set up yourself or a company-sponsored plan, you may be able to claim a tax credit on your nest egg.

The retirement savings contributions credit, sometimes referred to as the saver's credit, first appeared on 2002 returns. It was created to encourage lower-income people to put away retirement money. Up to $1,000 in tax savings can be gained through the credit as long as a taxpayer doesn't exceed the income thresholds ($25,000 for single filers; $50,000 for married couples filing jointly).

The tax credit can be from 10 percent to 50 percent of retirement contributions, up to the credit limit.

The exact percentage used to calculate the credit is phased in through the filing status income ranges so that basically, the lower a taxpayer's income, the bigger the credit. The precise credit amount also depends, of course, on just how much money a taxpayer saves toward retirement. The maximum amount of savings that can be used to figure the credit is $2,000 even though contribution levels to most retirement plans are well above that.

The saver's credit also is nonrefundable. That means that while you can use it to cut your tax bill to zero, you can't take advantage of any excess credit to produce a refund.