IRS News Release  
April 11, 1994

Millions to Receive Notice from the IRS on
How to Get Additional Money in
Their Paychecks

WASHINGTON - Over 16 million workers will qualify for the Earned Income Tax Credit (EITC) this year. However, many workers don't have to wait until next year to get it. Advance ETIC payments allow low income workers to increase their take-home pay by as much as $102 per month starting with their next paycheck.

Fewer than 1 percent of workers eligible for the credit are getting the advance payments. Recent studies show that many employees are unaware of how to get this extra money in their paychecks whole others fear their employers' reactions if they ask for the credit to be added to their paychecks.

A number of employers, however, view the advance payment as a means to increase their employees' take-home pay almost immediately without increasing their payroll burden. Employers also appreciate the AETIC payments' easing of employees' day-to-day financial concerns and infusion of additional funds into the local economy in a matter of weeks.

Major efforts are underway to educate the taxpayers and eliminate their fears. The White House, Treasury and Internal Revenue Service are encouraging public interest and advocacy groups, business associations, CEOs and federal agencies to promote the credit and put the advance ETIC in the pockets of the American people now.

To help notify taxpayers about the advance payment option, IRS will begin sending notices to all taxpayers who receive the credit on their 1993 tax return. The first set of notices will be mailed to approximately 10 million taxpayers beginning on April 22. The notices will include a Form W-5, Earned Income Credit Advance Payment Certificate, and information advising taxpayers who may qualify to return the completed 4-line certificate to their employer. The second mailout of advance ETIC notices will begin July 1 and go to over 3.5 million taxpayers. In September, over 700,000 taxpayers will receive notices in the final mailout.

For more information on the advance ETIC call an IRS assistor on 1-800-829-1040 or get Form W-5 or Publication 596, Earned Income Credit. Employers can learn more about their responsibilities and how easy it is to calculate the payment in Publication 15-Employer's Tax Guide. Employees and employers can receive these publication by calling 1-800-829-3676.

Previous | Next

1994 IRS News Releases | News Releases Main | Home