50% return guaranteed

Sounds like the emails I sometimes get sent, from some stanger who is trying to get people to speculate on penny stock. But this one is for real and completely legit. For those of us who are grad students, our income is modest to say the least. When you file taxes, the gov. will give you up to a 50% credit (not deduction) on the first $2000 you put into a retirement account (which would give you a $1,000 credit), which for most of us should be a Roth IRA. A quick google of “IRA tax credit” will give you hundreds of web pages about this.
Now here is my question, for the 8 or 10 of you reading this blog: If you take a standard deduction on taxes, which for poor people like us is usually the case, can we still claim this credit? Email me with your thoughts.
Now, assuming you can all get this cool credit, imagine how you can keep this $$ working for you: you get your $1000 credit, and you turn around and invest it in your 2006 IRA, immediately qualifying you potentially for another $500 credit the next year. Keep repeating until you get a real job and no longer qualify and before you know it, you will have a nice IRA started.