As a business owner, hiring new employees can be an exciting and important milestone for your company. However, with new employees comes new responsibilities, including the need to properly report their employment and compensation to the Internal Revenue Service (IRS). In this article, we will discuss about IRS forms are needed for new employees and provide you with all the information you need to make sure you comply with IRS regulations.
Form W-4
One of the first forms that you will need to have new employees fill out is Form W-4, also known as the Employee’s Withholding Certificate. This form is used to determine the amount of federal income tax that should be withheld from an employee’s paycheck. The information provided on the Form W-4 includes the employee’s filing status, number of dependents, and any additional withholding that they may want to request. It is important to note that employers are required to keep a copy of each employee’s Form W-4 on file, so be sure to make a copy for your records.
Form I-9
Another important form that must be completed by new employees is Form I-9, also known as the Employment Eligibility Verification form. This form is used to verify the employee’s identity and eligibility to work in the United States. Employers are required by law to ensure that each employee they hire is legally authorized to work in the United States, and failure to comply with this requirement can result in severe penalties. The information provided on the Form I-9 includes the employee’s name, address, date of birth, and social security number, as well as documentation that proves their eligibility to work in the United States, such as a passport or a driver’s license.
Form W-2
At the end of each year, employers are required to provide their employees with a Form W-2, also known as the Wage and Tax Statement. This form reports the employee’s total earnings and taxes withheld for the year. It is important to ensure that all information on the Form W-2 is accurate, as incorrect information can result in penalties and fines. The information provided on the Form W-2 includes the employee’s name, address, social security number, and total earnings for the year, as well as the amount of federal, state, and local taxes withheld.
Form 941
Form 941, also known as the Employer’s Quarterly Federal Tax Return, is used to report the amount of federal income tax, social security tax, and Medicare tax that is withheld from employee paychecks each quarter. This form is filed by the employer every quarter and must be filed on time to avoid penalties. The information provided on Form 941 includes the total number of employees, total wages paid, and the amount of federal income tax, social security tax, and Medicare tax withheld.
Form 940
Form 940, also known as the Employer’s Annual Federal Unemployment Tax Return, is used to report the amount of federal unemployment tax that is owed by the employer. This form is filed annually and must be filed on time to avoid penalties. The information provided on Form 940 includes the total wages paid to employees, the amount of federal unemployment tax owed, and any payments that have been made throughout the year.
State Forms
In addition to the federal forms that are required for new employees, there may be state-specific forms that you are required to file. These forms vary by state and may include forms for state income tax withholding, state unemployment tax, and state disability insurance. It is important to check with your state’s taxing authority to determine which forms are required for your business.
Final Words
In conclusion, hiring new employees comes with a lot of new responsibilities, including the need to properly report their employment and compensation to the IRS. By making sure that you have all of the necessary forms and information in order, you can avoid potential penalties and fines. Remember to keep copies of all forms on file for your records and file them on time to avoid any late fees or penalties.
Here are some additional tips to keep in mind when dealing with new employees and their required IRS forms:
- Ensure to provide new employees with the necessary forms and instructions on filling them out as soon as possible after they are hired.
- Keep track of deadlines for filing and submitting forms to avoid penalties.
- Double-check all information provided on the forms for accuracy.
- If you are unsure about any IRS form requirements, consult with a tax professional or an employment law attorney to ensure that you comply with all regulations.
In summary, hiring new employees can be a complex process, but by staying organized and informed about the necessary IRS forms, you can ensure that your business remains in compliance with all federal and state regulations. With the right tools and resources, you can make the process of hiring new employees a smooth and successful one for your business.
Read more about IRS Form 4562
FAQ
The common IRS forms needed for new employees are Form W-4 and Form I-9.
Form W-4 is an IRS tax form that employees use to provide their employer with information about their tax withholding preferences.
Form I-9 is an employment eligibility verification form that employers must complete for each new hire to verify their identity and eligibility to work in the United States.
Form I-9 should be completed by the employer within three days of the employee’s start date.
Failing to complete these forms for new employees can result in penalties and fines from the IRS.
