The EIC is a refundable tax credit for certain workers. Employers must notify each employee who worked at any time during the year and from whose wages you did not withhold income tax. However, employers do not have to notify any employees who claimed exemption from withholding on Form W-4, Employee’s Withholding Allowance Certificate. Please refer to IRS DOT Notice 1015 for details.
This notice can also be found on My ADP Resource > FormSource > Year End Processing. Earned Income Credit (EIC) verbiage is also located on the back of each employee W2:
“Earned income credit (EIC). You may be able to take the EIC for 2016 if your adjusted gross income (AGI) is less than a certain amount. The amount of the credit is based on income and family size. Workers without children could qualify for a smaller credit. You can any qualifying children must have valid social security numbers (SSNs). You cannot take the EIC if your investment income is more than the specified amount for 2016 or if income is earned for services provided while you were in an inmate at a penal institution. For 2016 income limits and more information, visit www.irs.gov/eitc. Also see Pub. 596, Earned Income Credit. Any EIC that is more than your tax liability is refunded to you, but only if you file a tax return.”
Several states and local jurisdictions have additional Earned Income Tax Credit notification requirements:
California AB 1847 – Earned Income Tax Credit (EITC) Notification
Click the following link to read more about California’s 2016 EITC Notification Requirements
Illinois (820 ILCS 170/) Earned Income Tax Credit (EITC) Information Act
Click the following link to read more about Illinois’ 2016 EITC Notification Requirements
Philadelphia AB 1847 – Earned Income Tax Credit (EITC) Notification
Click the following link to read an informational flyer about Philadelphia’s 2016 EITC eligibility for employers to give to their employees in 2017.