As an employer, one of your most important responsibilities when hiring new employees is to complete and secure necessary forms and records. The following are key requirements under federal law:
- Form I-9: Federal law requires employers to verify that each new employee is legally eligible to work in the United States. Within 3 business days of the date employment begins, employers must complete and sign Section 2 of Form I-9, Employment Eligibility Verification, using original documents presented by the employee that show his or her identity and authorization to work in the U.S.
- Employee’s Social Security Number (SSN):Employers are required to get each employee’s name and SSN for purposes of completing year-end Forms W-2. After an employee is hired, the employer should ask to see his or her social security card and record the new employee’s name and SSN from the card. Any employee without a social security card should apply for one.
- Form W-4: To know how much income tax to withhold from employees’ wages, employers should have a Form W-4, Employee’s Withholding Allowance Certificate, on file for each employee. Ask all new employees to give you a signed Form W-4 when they start work, and make the form effective with the first wage payment.
- New Hire Reporting: Federal law requires that employers report any new employee to a designated state new hire registry within 20 days (or shorter, depending on the state) of the date of hire. Many states accept a copy of Form W-4 with employer information added. The federal government maintains a list of links to state agencies where employers can learn more about reporting new hires and the specific requirements they must meet.
- Notice of Coverage Options (Exchange Notice): Employers are required to provide each new employee a written notice with information about a Health Insurance Exchange at the time of hiring, within 14 days of the employee’s start date. Model language is available from the U.S. Department of Labor.
Keep in mind that many states require additional forms and other records to be completed when a new employee begins work. Certain states and localities may also require employers to provide specific notices to newly hired employees.
Other key steps in the new hire process are featured in our Onboarding section.
Please Note: The information and materials herein are provided for general information purposes only and are not intended to constitute legal or other advice or opinions on any specific matters and are not intended to replace the advice of a qualified attorney, plan provider or other professional advisor. This information has been taken from sources which we believe to be reliable, but there is no guarantee as to its accuracy. In accordance with IRS Circular 230, this communication is not intended or written to be used, and cannot be used as or considered a ‘covered opinion’ or other written tax advice and should not be relied upon for any purpose other than its intended purpose.
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