What information must an employee disclose during the hiring process?

So, you’ve finally made it through the recruiting and interview process and found a suitable applicant to fill the position you need and are ready to put him to work. Unfortunately, your work as an employer isn’t yet over. There is still IRS paperwork to fill out and state new hire reporting requirements to follow.

Form I-9

Form I-9 is the Employment Eligibility Verification form and establishes an employee’s identity and eligibility to work in the United States. Under the Immigration Reform and Control Act, an employer cannot knowingly hire illegal immigrants and must verify that every employee is either a United States citizen, a permanent resident, or a foreign national with authorization to work in the United States. Completing and filing Form I-9 satisfies this requirement, and violations can cost employers up to $10,000 for each unauthorized alien.

Form W-2

Form W-2 is the Wage and Tax Statement and used to report the wages paid to employees and the taxes withheld. Employers must complete a Form W-2 for each employee they pay. On this form, the employer is required to get each employee’s name and Social Security Number. Form W-2 is only used for employees. By contrast, independent contractors are issued a Form 1099.

Form W-4

Form W-4 is the Employee’s Withholding Allowance Certificate. Employers should have all employees sign a Form W-4 when they start work. Form W-4 tells an employer how much income tax to withhold from an employee’s wages based on the employee’s tax situation, including exemptions and status.

New Hire Reporting

Federal law mandates that new hires be reported within twenty days of the date of hire to the Employer New Hire Reporting Operation Center. All employers are required to report new hires to their respective states as well. In Texas, employers must report the new hire’s name, address, social security number, date of birth, and date of hire. Once that information is received from the employer, it is given to the National Directory of New Hires.

The information is then used by various state agencies. The Child Support Program can use it to locate parents and establish paternity, establish a child support order, or enforce an existing order. The Texas Workforce Commission (TWC) uses the information to detect and prevent fraud. The TWC compares the new hire registry with the list of people receiving unemployment benefits and puts a stop to any double recovery by claimants.