Employee Notification Requirements for the Earned Income Tax Credit

IMGCAP(1)]In 2011, the federal government stopped the Advance Earned Income Tax Credits program. Today, Earned Income Tax Credits still exist, but on a 1040 personal tax return level only.

Some states have state EITC, and seven states and one city have Earned Income Tax Credits that have employee notification requirements. These states require employers to provide a separate EITC state notice, as well as the federal notice requirement.

Here is a breakdown of the requirements state by state:

California
Notice must be given with W-2, or within one week before or one week after the W-2 is provided. A sample notice can be downloaded here.

Illinois
Notice must be given with a W-2, or within one week before or one week after the W-2 is provided. Additionally, the notice must be updated annually to reflect the proper dollar amounts. A sample notice can be downloaded here.

Louisiana
Any business with 20 or more full-time or part-time employees must provide the state EITC notice at the time of hire. The 2014 notice can be in the form of a poster, and the poster can be downloaded in English and Spanish.

Maryland
Employers are required to provide a notice to all employees by December 31 of each calendar year. Employers can produce their own notice or use the state sample that is available for download here.

New Jersey
The state EITC notice must be given to potentially eligible employees between January 1 and February 15 each year. A sample state notice is available here.

Texas
Employers must provide employees with the state EITC notice no later than March 1 of each year. The Texas website that contains detailed instructions is here.

Virginia
Employers are required to post the state EITC notice in the same location as other mandated posters. The state poster in both English and Spanish is available for download here.

Philadelphia
As of Jan. 1, 2015, the city of Philadelphia is now requiring that all employers give an EITC notice to all Philadelphia resident employees. Philadelphia offers a sample notice in both English and Spanish. The notice is required to be provided at the same time W-2s are distributed. The notice can be provided electronically and is available here.

Be on the lookout for more states and local jurisdictions requiring notices in the future.

James Paille, CPP, is director of operations for myPay Solutions at Thomson Reuters.