There's a lot of paperwork involved to hire and pay employees in the United States, but don't worry -

this customized checklist tells you step-by-step what you need to do and where to go do it.

What state will you operate your business in?

  1. Make sure you have your EIN

    Before you hire your first employee, make sure you’ve gotten your Employer Identification Number (EIN) from the IRS. You can do this online in only a few minutes.

  2. Decide what kind of help to hire

    The difference between a full-time employee and a contractor is not always clear, and it affects how you pay income taxes, Social Security and Medicare taxes, and unemployment taxes.

  3. Make sure they’re legally allowed to work for you.

    Verify that your new employee is legally allowed to work in the US within the first 3 days of employment. You can do this online with US Citizenship & Immigration Services. It’s also a good idea to do a background check to avoid issues later.

  4. Report your hire to the state government within the first 20 days of employment

  5. Make sure you know the rights of your employees

    The federal government requires you to get workers compensation insurance, post labor law posters, and provide medical leave in certain instances. You might also have additional state and local laws to follow. Make sure you check with your local government about any additional requirements.

  6. Fill out the required tax forms

    If you’ve hired a full-time employee, have them fill out a W-4 form, which will inform the IRS of deductions and tax withholdings. If you’ve hired a contractor, fill out the W-9 form to request their Taxpayer Identification Number and Certification. You’ll use these later to send out annual tax forms.

  7. Determine how you’ll track hours worked and run payroll

    You can manually track time and write out checks, use an online service to automate pay schedules and run payroll, or outsource the whole deal.

  8. Make sure to file the right forms with the IRS and the California state government and to pay payroll and income taxes on time