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Recent News
The California legislature recently enacted A.B. 650, which takes effect January 8, 2008, and which requires ALL California employers to hand deliver or mail to ALL California employees the notice below. The notice must be hand delivered or mailed each year within one week before or after the employer provides the employees with a Form W-2, Form 1099, or other wage summary. Posting the notice or sending it through office mail is encouraged but is not alone sufficient to meet the notification requirement. If the notice is mailed, it should be sent to the employee’s last known home address. The notice provided can contain additional information so long as the following language is included.
BASED ON YOUR ANNUAL EARNINGS, YOU MAY BE ELIGIBLE TO RECEIVE THE EARNED INCOME TAX CREDIT FROM THE FEDERAL GOVERNMENT. THE EARNED INCOME TAX CREDIT IS A REFUNDABLE FEDERAL INCOME TAX CREDIT FOR LOW-INCOME WORKING INDIVIDUALS AND FAMILIES. THE EARNED INCOME TAX CREDIT HAS NO EFFECT ON CERTAIN WELFARE BENEFITS. IN MOST CASES, EARNED INCOME TAX CREDIT PAYMENTS WILL NOT BE USED TO DETERMINE ELIGIBILITY FOR MEDICAID, SUPPLEMENTAL SECURITY INCOME, FOOD STAMPS, LOW-INCOME HOUSING OR MOST TEMPORARY ASSISTANCE FOR NEEDY FAMILIES PAYMENTS. EVEN IF YOU DO NOT OWE FEDERAL TAXES, YOU MUST FILE A TAX RETURN TO RECEIVE THE EARNED INCOME TAX CREDIT. BE SURE TO FILL OUT THE EARNED INCOME TAX CREDIT FORM IN THE FEDERAL INCOME TAX RETURN BOOKLET. FOR INFORMATION REGARDING YOUR ELIGIBILITY TO RECEIVE THE EARNED INCOME TAX CREDIT, INCLUDING INFORMATION ON HOW TO OBTAIN THE IRS NOTICE 797 OR FORM W-5, OR ANY OTHER NECESSARY FORMS AND INSTRUCTIONS, CONTACT THE INTERNAL REVENUE SERVICE BY CALLING 1-800-829-3676 OR THROUGH ITS WEB SITE AT WWW.IRS.GOV.
The notice is to be given to all employees who worked part of the year in California. True independent contractors need not be given the notice but employers should exercise caution in excluding service providers who they call independent contractors or consultants but may in fact be employees.
Contact Eli Gould at eli@mbvlaw.com if you have questions about this new requirement.
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