Requirement to Notify Employees of Potential Earned Income Tax Credit (“EITC”) Eligibility 2023

Tax-General Article § 10-913 requires an employer to provide, on or before December 31, 2023, electronic or written notice to an employee who may be eligible for the federal and Maryland EITC.

Your employees may be entitled to claim an EITC on their 2023 federal and Maryland income tax returns if both their federal adjusted gross income and their earned income is less than the following: 

Employees who meet this income eligibility should be advised to visit the Internal Revenue Service Website at www.irs.gov, or contact a tax advisor, to see if they meet the other federal criteria. Employees who are eligible for the federal EITC are eligible for the Maryland EITC.

Married employees or employees with qualifying children may qualify for up to half of the federal EITC. Employees without a qualifying child may qualify for the full amount of the federal credit up to $600. A portion of the Maryland EITC may be refundable.

Employees who do not have, and are not eligible for, a social security number, but do have a federal taxpayer identification number (ITIN) may claim the Maryland EITC, even though they cannot claim the federal EITC. An ITIN filer determines their Maryland EITC by calculating the federal EITC they would have been eligible for if they had a social security number.

There is no minimum age requirement for taxpayers without a qualifying child. Certain employees may also qualify for a local EITC.

You may choose to notify all your employees, or you may choose to notify only those employees with wages less than or equal to the amounts shown above. A sample notification is included on the back of this Tax Bulletin and may be photocopied and distributed to your employees, or you may choose to develop your own notice.

Please see our 2024 edition of Withholding Tax Facts which offers more information about filing your employer withholding tax forms, reconciliation statement and other employer withholding related forms. 

Withholding Tax Facts is available at www.marylandcomptroller.gov

For more information about the Maryland EITC, visit our Web site at www.marylandcomptroller.gov, or call 1- 800-MD-TAXES (1-800-638-2937) or from Central Maryland 410-260-7980.

IMPORTANT NOTICE TO MARYLAND EMPLOYEES

Did you know that federal and Maryland earned income tax credits are available to certain low-income individuals and families?

These credits can reduce the amount of income tax you owe or increase your income tax refund; and you may qualify to receive some of these credits even if you did not earn enough income to be required to file a tax return.

2023 Maryland Earned Income Tax Credit (EITC)

Maryland’s EITC is a tax credit for certain taxpayers who have income and have worked. The state EITC reduces the amount of Maryland tax you owe. The local EITC reduces the amount of county tax you owe. Some taxpayers may even qualify for a refundable Maryland EITC. Refundable means that any amount of the credit beyond your tax liability will be refunded directly to you.

Most taxpayers who are eligible and file for a federal EITC can receive the Maryland state and local EITC. Taxpayers who do not qualify for the federal EITC because they do not have a social security number still qualify for the Maryland EITC if they have an ITIN. The allowable Maryland credit is up to one-half of the federal credit. To be eligible for the federal and Maryland EITC, your federal adjusted gross income and your earned income must be less than the following:  

Generally, to receive the Maryland EITC, you must be eligible for the federal credit. However, if you do not meet the minimum age requirement under the federal credit and are otherwise eligible for the federal credit for those without a qualifying child, or if you are otherwise eligible for the federal credit but do not have a social security number (SSN), you may claim the state earned income tax credit (calculate federal earned income credit disregarding the minimum age or SSN requirement). If your income is less than the amounts shown in this notice, visit the Internal Revenue Service Web site at irs.gov, or contact a tax advisor, to learn if you meet the other requirements. You also may be entitled to a refundable Maryland EITC and a local EITC.

If you are a part-year resident, you may be entitled to a prorated share of the credit, if you have Maryland income. Nonresidents are not eligible for the Maryland credit.

For more information about the Maryland EITC, visit our Web site at www.marylandcomptroller.gov or call 1- 800- MD-TAXES (1-800-638-2937) or from Central Maryland 410-260-7980.

2023 Federal Earned Income Tax Credit (EITC)

For more information about the federal EITC, visit: https://www.irs.gov/credits-deductions/individuals/earned-income-tax-credit-eitc or call the IRS at 1-800-829-1040.