© 2024 American Payroll Institute, Inc.
State and Local Earned Income Tax Credit Notice Requirements
Employers must comply with federal and state
requirements to send notices about the Earned Income
Tax Credit (EITC), even though employees no longer receive
advance payments of the credit as of 2011 (see The Payroll
Source®, §6.6). The IRS has released the tax year 2023 EITC
income limits and maximum credit amounts.
What’s new?
The Colorado requirements are new for this year (see
PAYSTATE UPDATE, Issue 24, Vol. 25), along with amendments
to existing California requirements.
Nine states and one city require notice
Nine states and one city require employers to provide
separate EITC notifications to their employees, in addition
to the required federal notice (see Guide to State Payroll
Laws, Table 4.3):
California. Notice requirements were amended,
effective January 1, 2024 (the amendments are set to expire
on January 1, 2029) [A.B. 1355, L. 2023]. Two notices are
now required. The first notice must still be given within one
week before or after, or at the same time, that the employer
provides a Form W-2 to the employee. The second notice
must be given to all employees during the month of March.
The first notice must be given by handing it to the
employee directly or mailing it to the employee at their last
known address. Employers are encouraged to also post the
notice on an employee bulletin board or send it through
office mail, but these methods do not satisfy the notification
requirements of the law.
The employer may provide the first notice via email to
an email account of the employee’s choosing in PDF, JPEG,
or other digital file format, if the employee affirmatively
and in writing or by electronic acknowledgement opts into
receipt of electronic statements.
The second notice, given in March, may be sent
electronically to all employees (opting in is not required).
A sample notice is available on the California
Employment Development Department website, but it has
not been updated since 2018. Effective January 1, 2024,
employers must also notify employees that they may be
eligible for: the Voluntary Income Tax Assistance Program
(VITA) CalFile, a program that allows taxpayers to e-file
California tax returns directly to the Franchise Tax Board for
free and state and federal anti-poverty tax credits.
EITC information is available on the California Franchise
Tax Board website. There is a webpage dedicated to the
state EITC with information for employees. Additional
information for employees, including information on
VITA and the additional tax credits, is also available on the
FTB website.
Colorado. Employers are required to provide notice of
federal and state refundable tax credits to employees who
receive a Form W-2. Employers must provide Forms W-2 to
employees annually by January 31 of the following year.
The notice can be provided electronically or in print. If
printed, notices must be at least 5.5 inches by 8.5 inches,
or half of a standard sheet of paper. A printed notice must
be on its own page. The Colorado Department of Revenue
(DOR) recommends providing the notice when providing
the Form W-2 (as the second page). Notices do not have to
be in color. While notices may be provided electronically,
employers cannot only provide the URL for the DOR’s
information on child tax credits and EITCs. Employers must
provide all the language included in the sample notice.
Illinois. The notice must be given within one week
before or after, or at the same time that the employer
provides a Form W-2 to the employee. A sample notice is
contained in Illinois law (820 ILCS §170/20). The notice
must be updated annually to reflect the maximum EITC and
the maximum earnings to which the tax credit will apply.
Information is also available on the Illinois Department of
Human Services website.
Louisiana. Any business establishment that has 20 or
more full-time or part-time employees must provide the
notice to employees at the time of hiring. The Louisiana
Workforce Commission provides an Earned Income Credit
poster on its website. The new tax year 2023 poster is
available.
Maryland. The notice must be given annually
December 31. Employers may develop their own notice or
use a sample notice provided by the Maryland Comptroller’s
Office (see Maryland Tax Alert, eff. 9-25-23, for a sample
notice see PAYSTATE UPDATE, Issue 24, Vol. 25).
New Jersey. The notice must be given to potentially
eligible employees between January 1 and February 15 of
each year to coincide with the employer’s distribution of
Forms W-2. The written notification must use the statement
developed by the New Jersey State Treasurer, which is
available online and has been updated for tax year 2023.
Oregon. Notice must be given annually with the
employee’s federal Form W-2. Sample language and a
template are available from the Oregon Bureau of Labor
and Industries on its website.
Texas. The notice must be given no later than
March 1 of each year. The Texas Workforce Commission
provides information about EITC notification on its website.
Virginia. The notice must be posted in the same
location where other employee notices required by state
January 22, 2024 Volume 26 Issue 2
State and Local Earned Income Tax Credit Notice Requirements
Employers must comply with federal and state
requirements to send notices about the Earned Income
Tax Credit (EITC), even though employees no longer receive
advance payments of the credit as of 2011 (see The Payroll
Source®, §6.6). The IRS has released the tax year 2023 EITC
income limits and maximum credit amounts.
What’s new?
The Colorado requirements are new for this year (see
PAYSTATE UPDATE, Issue 24, Vol. 25), along with amendments
to existing California requirements.
Nine states and one city require notice
Nine states and one city require employers to provide
separate EITC notifications to their employees, in addition
to the required federal notice (see Guide to State Payroll
Laws, Table 4.3):
California. Notice requirements were amended,
effective January 1, 2024 (the amendments are set to expire
on January 1, 2029) [A.B. 1355, L. 2023]. Two notices are
now required. The first notice must still be given within one
week before or after, or at the same time, that the employer
provides a Form W-2 to the employee. The second notice
must be given to all employees during the month of March.
The first notice must be given by handing it to the
employee directly or mailing it to the employee at their last
known address. Employers are encouraged to also post the
notice on an employee bulletin board or send it through
office mail, but these methods do not satisfy the notification
requirements of the law.
The employer may provide the first notice via email to
an email account of the employee’s choosing in PDF, JPEG,
or other digital file format, if the employee affirmatively
and in writing or by electronic acknowledgement opts into
receipt of electronic statements.
The second notice, given in March, may be sent
electronically to all employees (opting in is not required).
A sample notice is available on the California
Employment Development Department website, but it has
not been updated since 2018. Effective January 1, 2024,
employers must also notify employees that they may be
eligible for: the Voluntary Income Tax Assistance Program
(VITA) CalFile, a program that allows taxpayers to e-file
California tax returns directly to the Franchise Tax Board for
free and state and federal anti-poverty tax credits.
EITC information is available on the California Franchise
Tax Board website. There is a webpage dedicated to the
state EITC with information for employees. Additional
information for employees, including information on
VITA and the additional tax credits, is also available on the
FTB website.
Colorado. Employers are required to provide notice of
federal and state refundable tax credits to employees who
receive a Form W-2. Employers must provide Forms W-2 to
employees annually by January 31 of the following year.
The notice can be provided electronically or in print. If
printed, notices must be at least 5.5 inches by 8.5 inches,
or half of a standard sheet of paper. A printed notice must
be on its own page. The Colorado Department of Revenue
(DOR) recommends providing the notice when providing
the Form W-2 (as the second page). Notices do not have to
be in color. While notices may be provided electronically,
employers cannot only provide the URL for the DOR’s
information on child tax credits and EITCs. Employers must
provide all the language included in the sample notice.
Illinois. The notice must be given within one week
before or after, or at the same time that the employer
provides a Form W-2 to the employee. A sample notice is
contained in Illinois law (820 ILCS §170/20). The notice
must be updated annually to reflect the maximum EITC and
the maximum earnings to which the tax credit will apply.
Information is also available on the Illinois Department of
Human Services website.
Louisiana. Any business establishment that has 20 or
more full-time or part-time employees must provide the
notice to employees at the time of hiring. The Louisiana
Workforce Commission provides an Earned Income Credit
poster on its website. The new tax year 2023 poster is
available.
Maryland. The notice must be given annually
December 31. Employers may develop their own notice or
use a sample notice provided by the Maryland Comptroller’s
Office (see Maryland Tax Alert, eff. 9-25-23, for a sample
notice see PAYSTATE UPDATE, Issue 24, Vol. 25).
New Jersey. The notice must be given to potentially
eligible employees between January 1 and February 15 of
each year to coincide with the employer’s distribution of
Forms W-2. The written notification must use the statement
developed by the New Jersey State Treasurer, which is
available online and has been updated for tax year 2023.
Oregon. Notice must be given annually with the
employee’s federal Form W-2. Sample language and a
template are available from the Oregon Bureau of Labor
and Industries on its website.
Texas. The notice must be given no later than
March 1 of each year. The Texas Workforce Commission
provides information about EITC notification on its website.
Virginia. The notice must be posted in the same
location where other employee notices required by state
January 22, 2024 Volume 26 Issue 2
