Reminder - Give Employees Required EITC Notice with W2

Since Jan. 1, 2008, California employers who are required to provide unemployment insurance must notify all employees that they may be eligible for the federal Earned Income Tax Credit (EITC) within one week before or after, or at the same time, the employer provides an annual wage summary, including but not limited to a Form W-2 or Form 1099.

Posting this notification on a bulletin board or sending it through office mail is insufficient, but such notification may be used in addition to individual notifications as required under this new law. The notification must be handed directly to the employee or mailed to the employee's last known address. CalChamber members may access the notification form, AB 650 Employer required Notification - Earned Income Tax Credit in English or Spanish online.

What Should You Do?

    * Maintain a copy of the required notification and ensure each employee receives a copy within one week of receiving their W-2 or 1099.

    * Consult with your accountant, payroll service and/or legal counsel to assure compliance with federal and state tax laws.

    * Make sure you have current addresses for all employees, particularly if you mail tax information instead of handing it to employees.

Comments

[HR Watchdog]

Thank you for the question.

According to the CalChamber's senior employment law counsel, the EITC still exists. HR 1586 merely repealed the advance payment of EITC to employees.

For more information, please visit this IRS website: http://www.irs.gov/individuals/article/0,,id=150513,00.html

[Tami]

Ken - did you receive an answer on the EITC Notice with 2010 w-2s? Getting ready to send our w-2's out now...

[Ken Gee]

The Advance Earned Income Credit has been repealed per HR 1586 for 2011. Do employers still need to send out this notice for 2011? If so, do you know why?

Thanks.

[Watchdog]

The ultimate responsibility rests with you, the employer. You should also consult with your CPA account advisor.

[Luz Mendoza]

If we have outsourced our payroll, who is responsible for meeting the january 31st deadline for the W2 form?