First Hire Kit

Hiring Your First Employee: A Step-by-Step Checklist (US, 2026)

Last checked 2026-11-11

Going from zero employees to one triggers a handful of one-time registrations and a few recurring filings. Here they are in the order you'll need them, with links to the agency that owns each rule.

Before the offer

  1. Confirm it's an employee, not a contractor. If you set the hours, train them, and direct how the work is done, plan on W-2. See contractor vs employee.
  2. Budget the all-in cost. Wages plus employer taxes, workers' comp, and benefits. Use the employee cost calculator.
  3. Get an EIN if you don't have one. See how to get an EIN before your first hire. It's free from the IRS. Be wary of sites that charge for it (IRS: Get an EIN).
  4. Check your state and city minimum wage. The federal minimum is $7.25/hour, but many states and cities set it higher, and the highest applicable rate wins (DOL state minimum wage table). Our state guides cover 2026 minimum wage, SUTA, and leave rules in 10 states.

Register with your state

  1. State unemployment insurance account. You'll get a SUTA rate and account number. Find your agency through CareerOneStop or your state labor department.
  2. State income tax withholding account, if your state has an income tax (plus any local payroll taxes).
  3. Workers' compensation coverage. Almost every state requires it once you have employees. Texas is the well-known exception where it's optional for most private employers. Get quotes before the start date.
  4. Paid sick leave rules. There's no federal paid-leave mandate for most private employers, but a growing list of states and cities require paid sick leave, often 1 hour per 30 hours worked. See PTO accrual for part-time employees.

First day paperwork

  1. Form I-9. See I-9 for first-time employers. The employee completes Section 1 by their first day of work. You complete Section 2 within 3 business days after they start, after you look at their identity and work-authorization documents. Keep it on file; don't send it to the government (USCIS I-9 Central). E-Verify is voluntary federally but required in some states.
  2. Form W-4 for federal withholding, plus your state's withholding form if it has one (IRS W-4).
  3. New-hire report to your state's directory. Federal law requires it within 20 days of hire; some states require it sooner (HHS new hire reporting).
  4. Required workplace posters. Federal ones typically include the FLSA minimum wage poster, the EEO "Know Your Rights" poster (15+ employees), and the polygraph (EPPA) notice. Your state has its own. The DOL FirstStep Poster Advisor tells you which apply. They're free; you don't need to buy a poster kit.

Every payday and every quarter

  1. Run payroll: withhold federal income tax, the employee's 6.2% Social Security and 1.45% Medicare, and state taxes, and pay your matching employer share. See employer payroll taxes in 2026.
  2. Deposit taxes through EFTPS on your assigned schedule (monthly or semiweekly).
  3. File Form 941 quarterly (or Form 944 if the IRS notifies you), Form 940 annually for FUTA, and your state unemployment wage reports.
  4. Give W-2s to employees and file them with the SSA by January 31.
  5. Keep records: hours worked for non-exempt staff, pay rates, and payroll records. The FLSA requires payroll records to be kept at least 3 years.
This checklist covers common federal requirements and typical state steps. It isn't legal advice. Your state may add steps such as disability insurance, local taxes, or harassment training. Check your state labor agency before the start date.

FAQ

How long do I have to complete Form I-9?

The employee completes Section 1 by the first day of work. The employer completes Section 2 within three business days after the employee's first day.

Do I need workers' comp for one employee?

In nearly every state, yes. Texas is the main exception, where coverage is optional for most private employers. Some states exempt very small employers or certain job types, so check your state's rules.

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