Today's Law As Amended


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AB-1847 Earned Income Tax Credit Information Act: California Earned Income Tax Credit.(2015-2016)



As Amends the Law Today


SECTION 1.

 Section 19851 of the Revenue and Taxation Code is amended to read:

19851.
 The Legislature finds and declares as follows:
(a) Congress created the federal earned income tax credit (EITC) in 1975 to offset the adverse effects of the Medicare and social security payroll taxes on working poor families and to encourage low-income workers to seek employment rather than welfare.
(b) Due to a relatively low percentage of federal earned income tax credit eligible persons who participate in the federal Earned Income Tax Credit program, hundreds of millions of federal dollars go unclaimed by the working poor in California.
(c) In 2015, the State of California authorized a California state  EITC to amplify the poverty-reducing effects of the federal EITC for the poorest working Californians.  
(d) In order to alleviate the tax burden on working poor persons and families, to enhance the wages and income of working poor persons and families, to ensure that California taxpayers receive their  receives its  share of the federal money available in the federal EITC program and other state and federal antipoverty tax credits,  Earned Income Tax Credit program,  to ensure that the poorest working Californians access the additional California state  EITC, and to inject additional federal money into the California economy, the state shall facilitate the furnishing of information, as permitted by Section 19551.3,  information  to working poor persons and families regarding the availability of the federal and California EITC  state earned income tax credit  so that they may claim those credits on their federal and state income tax returns.
(e) It is the intent of this act to offer the most cost-effective assistance to eligible taxpayers by taking steps to ensure that eligible Californians claim both the federal and California EITC and other state and federal antipoverty tax credits and are aware of free tax preparation services  through the following:
(1) Notices provided by their employers.
(2) Notices provided by state departments and agencies that serve those who may qualify for the EITC.
(3) By taking steps to ensure that eligible Californians claim both the federal and state EITC.

SEC. 2.

 Section 19852 of the Revenue and Taxation Code is amended to read:

19852.
 For purposes of this part, the following terms have the following meanings:
(a) “Employer” means any California employer who is subject to, and is required to provide, unemployment insurance to their  his or her  employees, under the Unemployment Insurance Code.
(b) “Employee” means any person who is covered by unemployment insurance by their  his or her  employer, pursuant to the Unemployment Insurance Code.
(c) “Federal EITC” means the federal earned income tax credit, as defined in Section 32 of the Internal Revenue Code.
(d) “California EITC” means the California earned income tax credit, as defined in Section 17052. 17052 of the Revenue and Taxation Code. 
(e) “State departments and agencies that serve those who may qualify for Voluntary Income Tax Assistance or state and federal antipoverty tax credits, including the federal  the federal EITC  and the California EITC” means the following programs in the specified  departments and agencies:
(1) The State Department of Education with respect to information from the  Education:  free or reduced-price meal program and National School Lunch Program.
(2) The Employment Development Department with respect to information from the California Unemployment Insurance program. Employment Development Department: California Unemployment Insurance. 
(3) The  State Department of Health Care Services with respect to information from  Services:  the Medi-Cal program.
(4) The State Department of Social Services with respect to information from the CalFresh and CalWORKS programs.
(f) “State and federal antipoverty tax credits” means state and federal tax credits that are designed to alleviate poverty and tax burdens for low-income households.
(g) “Voluntary Income Tax Assistance” or “(VITA)” means the free basic income tax return preparation program, for federal and state personal income tax returns, managed by the Internal Revenue Service and operated by Internal Revenue Service partners and trained volunteers.
(h) “CalFile” means the Franchise Tax Board’s free, direct, online program for taxpayers to complete and e-file their state personal income tax returns.
(i) The amendments made to this section by Section 2 of Chapter 294 of the Statutes of 2016 shall apply to notices required pursuant to Section 19853 furnished on or after January 1, 2017.
(j) (f)  The amendments made to this section by the act adding this subdivision shall apply to notices required pursuant to Section 19853 furnished on or after January 1, 2024. the effective date of that act. 

SEC. 3.

 Section 19853 of the Revenue and Taxation Code is amended to read:

19853.
 (a) (1)  An employer shall notify all employees that they may be eligible for VITA, CalFile, and state and federal antipoverty tax credits, including  the federal and the California EITC, EITC  within one week before or after, or at the same time, that the employer provides an annual wage summary, including, but not limited to, a Form W-2 or a Form 1099, to any employee.
(2) An employer shall send a second notification to all employees during the month of March of the same year in which the employer notified employees pursuant to paragraph (1).
(b) (1)  The state departments and agencies that serve those who may qualify for VITA or state and federal antipoverty tax credits, including  the federal and the California EITC, as defined in subdivision (e) of Section 19852, shall notify their program recipients that they may be eligible for VITA, CalFile, and state and federal antipoverty tax credits, including  the federal and the California EITC, at least once per a  year during the months of January through March, or, April, or  alternatively, shall provide both notifications  this annual notification  during a regularly scheduled contact with a recipient by telephone, mail, or electronic communication, or by an in-person communication. State departments or agencies that do not directly communicate with persons or households with persons who may qualify for the federal and the California EITC may communicate indirectly through agencies, districts, or regulated entities that serve eligible persons or households with eligible persons. Departments, agencies, and programs are encouraged to develop the most effective method to provide notice to recipients of federal and California EITC eligibility, as long as the notice contains substantially the same language as the notice described in Section 19854. 
(2) State departments or agencies that serve those who may qualify for VITA or state and federal antipoverty tax credits, including the federal and the California EITC, as defined in subdivision (e) of Section 19852, and that do not directly communicate with persons or households with persons who may qualify for VITA, CalFile, and state and federal antipoverty tax credits, including the federal and the California EITC, may communicate indirectly through agencies, districts, or regulated entities that serve eligible persons or households with eligible persons.
(3) State departments or agencies that serve those who may qualify for VITA or state and federal antipoverty tax credits, including the federal EITC and the California EITC, as defined in subdivision (e) of Section 19852, are encouraged to develop the most effective method to provide notice to recipients of eligibility for VITA, CalFile, and state and federal antipoverty tax credits, including the federal and the California EITC, as long as the notice contains substantially the same language as the notice described in Section 19854.
(c) (1)  The employer shall provide the notifications notification  required by subdivision (a) by handing them  directly to the employee or mailing them  to the employee’s last known address. address either of the following: 
(1) Instructions on how to obtain any notices available from the Internal Revenue Service and the Franchise Tax Board for this purpose, including, but not limited to, the IRS Notice 797 and information on the California EITC at the Web site www.ftb.ca.gov.
(2) Any notice created by the employer shall include  employer, as long as it contains  substantially the same language as the notice described in paragraph (1) or in  Section 19854.
(3) The notification required by paragraph (2) of subdivision (a) may be sent electronically.
(d) The employer shall not satisfy the notification required by subdivision (a) by posting a notice on an employee bulletin board or sending it through office mail. However, these methods of notification are encouraged to help inform all employees of VITA, CalFile, and state and federal antipoverty tax credit eligibility, including  the federal and the California EITC.
(e) (1) Notwithstanding subdivisions (c) and (d), the employer may provide the notification required by paragraph (1) of subdivision (a) via email to an email account of the employee’s choosing in PDF, JPEG, or other digital image file type format, if an employee affirmatively, and in writing or by electronic acknowledgment, opts into receipt of electronic statements or materials.
(2) An employer may not discharge an employee or in any manner discriminate, retaliate, or take any adverse action against an employee who does not affirmatively, in writing or by electronic acknowledgment, opt into receipt of electronic statements or materials.
(f) The amendments made to this section by Section 3 of Chapter 294 of the Statutes of 2016 shall apply to notices furnished on or after January 1, 2017.
(g) The amendments made to this section by Section 10 of Chapter 55 of the Statutes of 2023 shall apply to notices furnished on or after January 1, 2024.
(h) (e)  The amendments made to this section by the act adding this subdivision shall apply to notices furnished on or after January 1, 2024. the effective date of that act. 
(i) This section shall remain in effect only until January 1, 2029, and as of that date is repealed.

SEC. 4.

 Section 19854 of the Revenue and Taxation Code is amended to read:

19854.
 (a) The notice required under Section 19853 to be  furnished to employees and public assistance program recipients  regarding the availability of the federal and the California EITC shall state substantially  as follows:

Based on your annual earning, you may be eligible for the following assistance:
Voluntary Income Tax Assistance (VITA) Program – VITA is a free basic income tax return preparation program, for federal and state personal income tax returns, managed by the Internal Revenue Service and operated by Internal Revenue Service partners and trained volunteers.
Federal Earned Income Tax Credit (federal EITC) – The federal EITC is a refundable credit for low-income working individuals and families. The federal EITC will not impact certain public assistance benefits. In addition, federal EITC payments are typically NOT used to determine eligibility for the following: BASED ON YOUR ANNUAL EARNINGS, YOU MAY BE ELIGIBLE TO RECEIVE THE EARNED INCOME TAX CREDIT FROM THE FEDERAL GOVERNMENT (FEDERAL EITC). THE FEDERAL EITC IS A REFUNDABLE FEDERAL INCOME TAX CREDIT FOR LOW-INCOME WORKING INDIVIDUALS AND FAMILIES. THE FEDERAL EITC HAS NO EFFECT ON CERTAIN WELFARE BENEFITS. IN MOST CASES, FEDERAL EITC 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 FEDERAL TAX RETURN TO RECEIVE THE FEDERAL EITC. BE SURE TO FILL OUT THE FEDERAL EITC FORM IN THE FEDERAL INCOME TAX RETURN BOOKLET. FOR INFORMATION REGARDING YOUR ELIGIBILITY TO RECEIVE THE FEDERAL EITC, INCLUDING INFORMATION ON HOW TO OBTAIN THE IRS NOTICE 797 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. 
(A) Medicaid.
(B) Supplemental Security Income.
(C) Supplemental Nutrition Assistance Program.
(D) Low-income housing.
(E) Temporary Assistance for Needy Families payments.
To receive the federal EITC, you must file a federal tax return and fill out the EITC form, which can be found in the Federal Income Tax Return Booklet. For additional information on your eligibility to receive the federal EITC and other federal antipoverty tax credits, visit www.irs.gov.
California Earned Income Tax Credit (California EITC) and Young Child Tax Credit (YCTC) – The California EITC and YCTC are refundable credits for low-income working individuals and families. The California EITC and YCTC are similar to the federal EITC and will not impact certain public assistance benefits. YOU ALSO MAY BE ELIGIBLE TO RECEIVE THE CALIFORNIA EARNED INCOME TAX CREDIT (CALIFORNIA EITC) STARTING WITH THE CALENDAR YEAR 2015 TAX YEAR. THE CALIFORNIA EITC IS A REFUNDABLE STATE INCOME TAX CREDIT FOR LOW-INCOME WORKING INDIVIDUALS AND FAMILIES. THE CALIFORNIA EITC IS TREATED IN THE SAME MANNER AS THE FEDERAL EITC AND GENERALLY WILL NOT BE USED TO DETERMINE ELIGIBILITY FOR WELFARE BENEFITS UNDER CALIFORNIA LAW. TO CLAIM THE CALIFORNIA EITC, EVEN IF YOU DO NOT OWE CALIFORNIA TAXES, YOU MUST FILE A CALIFORNIA INCOME TAX RETURN AND COMPLETE AND ATTACH THE CALIFORNIA EITC FORM (FTB 3514). FOR INFORMATION ON THE AVAILABILITY OF THE CREDIT, ELIGIBILITY REQUIREMENTS, AND HOW TO OBTAIN THE NECESSARY CALIFORNIA FORMS AND GET HELP FILING, CONTACT THE FRANCHISE TAX BOARD AT 1-800-852-5711 OR THROUGH ITS WEB SITE AT WWW.FTB.CA.GOV. 
Foster Youth Tax Credit (FYTC) – The FYTC is a refundable credit for former and current foster youth between 18 and 25 years of age who were in foster care while 13 years of age or older. The FYTC will not impact certain public assistance benefits.
To claim the California EITC, you must file a California Income Tax Return and fill out the California EITC form (Form FTB 3514) and attach it to your tax return. For additional information on the availability of the credit, including eligibility requirements, or form questions, visit www.ftb.ca.gov and enter “CalEITC” in the search box.
You may also be eligible to have both your federal and state tax returns prepared and filed for free using VITA services. For additional information on the free tax filing service, and location and hours of operation, visit www.ftb.ca.gov and enter “VITA” in the search box.
Additionally, you may be eligible to e-file your California return directly with the Franchise Tax Board for free using CalFile. For additional information on CalFile, visit www.ftb.ca.gov and enter “CalFile” in the search box.

(b) The amendments made to this section by Chapter 294 of the Statutes of 2016 apply to notices furnished on or after January 1, 2017.
(c) (b)  The amendments made to this section by the act adding this subdivision shall apply to notices furnished on or after January 1, 2024. the effective date of that act.