Hiring your first employee: registrations and forms

The first employee turns a business into an employer, with a set of registrations and forms that did not apply before. This guide lists them in order so nothing is missed.

By Muhammad Bilal, Chartered Accountant. Reviewed by Awais Jameel, Chartered Accountant. Checked against official sources on . 2 minute read.

Short answer

Before hiring your first employee, get an EIN, register for state withholding and unemployment tax, and arrange workers' compensation insurance. When they start, have them complete Form W-4 and Form I-9, report them to your state's new hire registry within 20 days or sooner if your state requires, and set up payroll to withhold and deposit taxes.

At a glance

Before hiring
EIN, state registrations, workers' compensation
Form W-4
Employee's federal withholding certificate
Form I-9
Employment eligibility, completed within 3 business days of starting
New hire reporting
To the state within 20 days, sooner in some states
Contractor or employee?
Check classification first
Records
Keep employment tax records at least 4 years
Hiring your first employee: registrations and formsSteps: 1. An EIN; 2. State tax registrations; 3. Workers' compensation insurance; 4. A payroll system.THE PROCESS AT A GLANCEHiring your first employee: registrations andforms1An EINRequired for payroll, evenfor a single-member LLC2State taxregistrationsState income tax withholding,where applicable, and stateunemployment insurance3Workers' compensationinsuranceRequired by most states foremployers, sometimes from thefirst employee4A payroll systemSoftware or a provider, andan EFTPS enrollment forfederal depositsChecked against official sourcesTax BakersHiring your first employee: registrations and formsSteps: 1. An EIN; 2. State tax registrations; 3. Workers' compensation insurance; 4. A payroll system.THE PROCESS AT A GLANCEHiring your first employee:registrations and forms1An EINRequired for payroll, even for asingle-member LLC2State tax registrationsState income tax withholding, whereapplicable, and state unemployment insurance3Workers' compensation insuranceRequired by most states for employers,sometimes from the first employee4A payroll systemSoftware or a provider, and an EFTPSenrollment for federal depositsChecked against official sourcesTax Bakers
The process at a glance: 1. An EIN; 2. State tax registrations; 3. Workers' compensation insurance; 4. A payroll system.

Is the person an employee?

Check first. If you control how, when and where the work is done, the person is likely an employee, whatever you call them. See independent contractor or employee.

What do you need before the first day?

  1. An EIN

    Required for payroll, even for a single-member LLC. See does a single-member LLC need an EIN.

  2. State tax registrations

    State income tax withholding, where applicable, and state unemployment insurance.

  3. Workers' compensation insurance

    Required by most states for employers, sometimes from the first employee.

  4. A payroll system

    Software or a provider, and an EFTPS enrollment for federal deposits. See how to run payroll.

See state unemployment tax registration and how employee benefits are taxed.

Which forms does the employee complete?

FormPurposeTiming
Form W-4Federal income tax withholdingBy the first payroll
State withholding formState income tax withholding, where the state uses its ownBy the first payroll
Form I-9Verifies identity and eligibility to work in the USEmployee section by the first day; employer section within 3 business days
Direct deposit and personal detailsPaying the employeeBefore the first payroll

Keep Forms I-9 separately from personnel files, for as long as the rules require after employment ends.

What is new hire reporting?

Employers must report each new employee to their state's new hire registry, generally within 20 days of hiring, and some states set shorter deadlines. States use the information for child support enforcement and to check unemployment claims.

What else applies to employers?

  • Federal and state labor law posters displayed where employees can see them, or provided electronically for remote staff where allowed.
  • Minimum wage and overtime rules, federal and state.
  • Pay frequency and final pay rules set by the state.
  • Payroll taxes. See payroll taxes explained.

Hiring a relative has its own rules. See hiring family members.

What if the employee works in another state?

You generally register and withhold in the state where the employee works, which can create an income tax or sales tax presence there too. See physical vs economic nexus.

See remote employees in another state.

Hiring your first employee?

We handle the registrations, onboarding forms and payroll set-up, and run your payroll from the first pay day.

Book a call Chat on WhatsApp

Questions people ask

What do I need to hire my first employee?

An EIN, state withholding and unemployment registrations, workers' compensation insurance, and a payroll system.

Which forms does a new employee fill out?

Form W-4, any state withholding form, and Form I-9 to verify eligibility to work.

When is Form I-9 due?

The employee completes their section by the first day of work, and the employer completes theirs within 3 business days.

What is new hire reporting?

Reporting each new employee to the state's new hire registry, generally within 20 days of hiring.

Sources

Every fee, date and rule on this page was taken from these official and primary sources.

  1. IRS Publication 15 (Circular E): Employer's Tax Guide
  2. IRS: Form W-4, Employee's Withholding Certificate
  3. USCIS: Form I-9, Employment Eligibility Verification
  4. US Department of Health and Human Services: new hire reporting for employers

Rules and fees change. If you are reading this long after September 30, 2026, confirm the figures with the source before you rely on them.

Payroll and contractorsHow to run payroll for the first timePayroll and contractorsPayroll taxes explained: FICA, FUTA and state unemploymentPayroll and contractorsIndependent contractor or employee: how the IRS tells them apart

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This guide is general information. It is not tax or legal advice for your situation.