Independent U.S. payroll tax information · Educational guidance only · Not tax or legal advice
Blog · New employers · November 2026

Hiring Your First Employee? The First-Payroll Checklist

Eight steps stand between "you're hired" and a legal first paycheck. Do them in this order and you'll avoid the penalties that catch most first-time employers.

The 8-step checklist

1. Get a federal EIN. Apply free with the IRS — you'll need it for every filing and deposit.

2. Register with your state. Most states require separate employer registrations for income-tax withholding and unemployment insurance. Find your agencies in the state guides.

3. Classify the worker correctly. Employee or contractor? Get this wrong and back taxes follow — read W-2 vs 1099 before deciding.

4. Collect Form W-4 and Form I-9. W-4 sets federal withholding; I-9 verifies work eligibility. Both must be done at hire.

5. Choose a pay schedule and stick to it. Weekly, bi-weekly, semi-monthly, or monthly — states restrict your options, so check your state first.

6. Enroll in EFTPS. New employers deposit monthly, by the 15th of the following month. Enrollment takes days, so do it before payday.

7. Budget the true cost. Add ~7.65% FICA match plus unemployment insurance on top of salary — work the math here.

8. Set up recordkeeping or software. You're required to keep payroll records for years. Compare payroll software built for first-time employers.

State new-hire reporting:

Most states require you to report new hires within 20 days to the state directory — a separate step from tax registration that carries its own fines. Your state guide has the link.

Keep reading

The True Cost of an Employee

Budget the hire correctly before the offer letter goes out.

See the math →

State Payroll Guides

Registration, withholding, and new-hire reporting for your state.

Find your state →

2026 Deadline Calendar

Every deposit and filing date for your first year as an employer.

See the dates →