Governor Polis Signs HB 23-1006 into Law, Requiring Employers to Provide Annual Notices of Available Tax Credits to Employees

Ashley Graves, Law Clerk

On March 31, 2023, HB 23-1006[1] was signed into law, adding an additional notice requirement between Colorado employers and their employees.  Currently, for tax purposes, employers must provide employees with an annual statement showing total compensation paid, and the income tax withheld, for the preceding calendar year (such as an IRS Form W-2).  HB 23-1006 imposes an additional requirement for employers to also provide written notice of the availability of federal and state earned income tax credits, as well as federal and state child tax credits.  Employers must provide this notice at least once annually.  The notice may be sent to employees electronically, including via email or text message.  The notice must be in English and any other language the employer typically uses to communicate with employees. 

The bill is effective on the day following the expiration of the ninety-day period after final adjournment of the General Assembly.  Importantly, employers must also include in the notice any additional content the Department of Revenue prescribes, so Campbell Litigation will continue monitoring this bill, and will update employers on any new content requirements.  Employers are encouraged to coordinate with their payroll departments or third-party administrators to ensure that these new notice requirements are being met moving forward. 

[1] https://leg.colorado.gov/bills/HB23-1006