New Employee Forms: The Complete Checklist for Hiring Your First (or Next) Team Member

Hiring your first employee is exciting—until you realize the mountain of paperwork waiting for you. Miss a form or file something late, and you could face penalties ranging from a few hundred dollars to nearly $28,000 per violation.

The good news? Once you understand what's required, managing new hire paperwork becomes a straightforward process. This guide walks you through every form you need, when each one is due, and how to stay compliant without drowning in administrative work.

Why New Hire Paperwork Matters

Getting hiring paperwork right isn't just about checking boxes. It protects you from legal liability, ensures your employees can work legally, and sets up accurate tax withholding from day one.

The stakes are real. A company with 1,000 employees and a 65% error rate on I-9 forms could face penalties exceeding $1.8 million. Even small businesses with a handful of employees can accumulate significant fines if paperwork isn't completed correctly and on time.

But compliance isn't just about avoiding penalties. Proper documentation creates a foundation for a professional employer-employee relationship and demonstrates that your business takes its obligations seriously.

Required Federal Forms

These forms are mandated by federal law. Every employer must complete them for every new hire, no exceptions.

Form I-9: Employment Eligibility Verification

The I-9 verifies that your new employee is authorized to work in the United States. Both U.S. citizens and non-citizens must complete this form.

What it covers:

• Employee's identity verification
• Work authorization status
• Documentation review

Deadlines:

• Section 1 (Employee): Must be completed no later than the first day of employment
• Section 2 (Employer): Must be completed within three business days of the hire date

For example, if someone starts on Monday, you must complete Section 2 by Thursday.

Document requirements: Employees must present original documents from an approved list. Acceptable combinations include:

• One document from List A (establishes both identity and work authorization), such as a U.S. passport or permanent resident card
• OR one document from List B (identity only, like a driver's license) PLUS one document from List C (work authorization only, like a Social Security card)

Retention: Keep I-9 forms for three years after the hire date OR one year after employment ends—whichever is later. Store them separately from personnel files so they can be quickly produced during an audit.

Common mistakes to avoid:

• Completing the form late (the three-day rule is strictly enforced)
• Accepting expired documents
• Asking for specific documents (you must accept any valid documents from the approved lists)
• Missing signatures or incomplete fields
• Discriminating based on national origin or citizenship status

Form W-4: Employee's Withholding Certificate

The W-4 tells you how much federal income tax to withhold from each paycheck. Without it, you can't process payroll correctly.

What it covers:

• Filing status (single, married, head of household)
• Multiple jobs or working spouse
• Dependents and credits
• Additional withholding requests

Deadlines: New employees should complete the W-4 before their first paycheck. The form takes effect with the first wage payment.

Key rules:

• A W-4 remains in effect until the employee submits a new one
• If an employee claims exempt status, they must submit a new form by February 15 each year to maintain that exemption
• You don't submit W-4s to the IRS, but you must keep them on file for at least four years

Retention: Keep W-4 forms in the employee's personnel file for four years after the employee leaves or the form is replaced.

State Tax Withholding Forms

Most states with income tax require their own withholding form in addition to the federal W-4. The form name varies by state—California uses DE-4, New York uses IT-2104, and so on.

States without income tax (no form required): Alaska, Florida, Nevada, New Hampshire (wages only), South Dakota, Tennessee (wages only), Texas, Washington, Wyoming

For all other states, check your state's department of revenue website for the current withholding form.

Required State and Local Forms

Beyond tax withholding, states impose additional requirements.

New Hire Reporting

Federal law requires employers to report new hires to their state within 20 days (some states require faster reporting). This information helps locate parents who owe child support.

What to report:

• Employee's name, address, and Social Security number
• Employer's name, address, and Federal Employer Identification Number (FEIN)
• Employee's start date

Most states accept online submissions through their new hire reporting website.

State-Specific Requirements

Depending on your state, you may also need:

• Workers' compensation enrollment forms
• Unemployment insurance registration
• State disability insurance forms (California, Hawaii, New Jersey, New York, Rhode Island)
• Local tax withholding forms (varies by city/county)

Check with your state's labor department for location-specific requirements.

Company-Specific Forms (Recommended)

While not legally required, these forms protect your business and improve the employee experience.

Direct Deposit Authorization

Most employees prefer electronic deposits to paper checks. This form captures:

• Bank name and routing number
• Account number
• Account type (checking or savings)
• Deposit amount or percentage

Keep a signed copy in the employee's file and provide the information to your payroll processor.

Offer Letter

A well-crafted offer letter sets clear expectations and reduces misunderstandings. Include:

• Job title and department
• Start date and work schedule
• Compensation (salary or hourly rate)
• Benefits eligibility and waiting periods
• At-will employment statement (if applicable)
• Reporting structure
• Contingencies (background check, drug screening, etc.)

Have the employee sign and return a copy to acknowledge they've received and understood the terms.

Emergency Contact Form

Collect the name, relationship, and phone number of at least one emergency contact. Store this information securely and keep it accessible to managers who might need it.

Employee Handbook Acknowledgment

If you have an employee handbook, have new hires sign an acknowledgment stating they've received it, will read it, and agree to follow company policies. This documentation matters if policy violations occur later.

Benefits Enrollment Forms

If you offer health insurance, retirement plans, or other benefits, new employees need enrollment forms and information about:

• Plan options and coverage levels
• Contribution amounts and payroll deductions
• Enrollment deadlines (often within 30 days of hire)
• Beneficiary designations

Background Check Authorization

If your company conducts background checks—common in finance, healthcare, education, and positions involving sensitive information—you need written authorization before requesting the check.

Under the Fair Credit Reporting Act (FCRA), you must:

• Provide a standalone disclosure that you'll conduct a background check
• Obtain written consent from the applicant
• Follow adverse action procedures if you decide not to hire based on the results

Non-Disclosure Agreement (NDA)

If employees will access trade secrets, proprietary information, or confidential customer data, consider having them sign an NDA. This establishes clear expectations about information security and provides legal recourse if confidentiality is breached.

Non-Compete or Non-Solicitation Agreements

Some employers use agreements restricting employees from working for competitors or soliciting clients after leaving. Note that non-compete enforceability varies significantly by state—some states (like California) largely prohibit them.

Consult an employment attorney before requiring these agreements.

Creating Your New Hire Paperwork System

A systematic approach prevents missed deadlines and lost documents.

Before Day One

Send these items in a preboarding packet:

• Offer letter (for signature and return)
• W-4 form
• State tax withholding form
• Direct deposit authorization
• Employee handbook (if applicable)
• Benefits overview

This gives new hires time to gather information (like bank account details) and ask questions before their first day.

Day One

Complete during onboarding:

• Form I-9 (Section 1)
• Document review for I-9 (Section 2)
• Emergency contact form
• Handbook acknowledgment
• Benefits enrollment (or schedule enrollment meeting)

Within First Week

Finish any remaining items:

• Submit new hire report to state
• Complete background check (if in progress)
• Set up payroll with all withholding information
• File all forms in employee's personnel file

Ongoing Maintenance

• Review I-9 files annually for expired work authorizations
• Request updated W-4s when employees report life changes
• Update emergency contacts periodically
• Conduct internal I-9 audits before ICE requests one

Document Storage Best Practices

Proper storage protects both compliance and privacy.

Separate I-9 files from personnel files. If ICE audits your I-9s, you don't want them accessing other employee information. A dedicated I-9 binder or digital folder makes audit response faster and cleaner.

Maintain consistent retention periods:

• I-9 forms: 3 years from hire or 1 year from termination (whichever is later)
• W-4 and tax documents: 4 years minimum
• Personnel files: 6+ years after termination (varies by state)

Consider digital solutions. E-signature platforms and HR software streamline collection, reduce errors, and create automatic backups. Just ensure your digital system meets legal requirements for electronic signatures and records.

Avoiding Common Pitfalls

Don't skip forms because someone is "temporary." Even seasonal workers and interns require I-9s and W-4s if they're employees (not contractors).

Don't over-document identity. Asking for more documents than required—or specifying which documents to provide—can constitute discrimination. Accept any valid combination from the approved lists.

Don't backdate forms. If you missed a deadline, document when the form was actually completed. Backdating creates legal liability.

Don't confuse employees with contractors. Independent contractors complete Form W-9, not W-4 or I-9. Misclassifying employees as contractors triggers different compliance issues entirely.

Don't forget remote employees. If your new hire works remotely, you can use an authorized representative to complete the I-9 document review. This person doesn't need special credentials—just someone who can physically examine the documents and complete Section 2.

Track Everything in Your Financial Records

New employee costs extend beyond salary—there's payroll taxes, benefits contributions, equipment, and onboarding expenses. Tracking these costs from day one helps you understand the true cost of hiring and budget accurately for future growth.

Setting up proper expense categories when you hire makes tax time easier and gives you clear visibility into labor costs as your team grows.

Keep Your Business Organized from the Start

Hiring paperwork is just one piece of running a compliant, organized business. As your team grows, maintaining clear financial records becomes increasingly important—from tracking payroll taxes to managing benefits expenses.

Beancount.io provides plain-text accounting that gives you complete transparency and control over your business finances. No proprietary formats, no vendor lock-in—just clean, version-controlled financial data that grows with your business. Get started for free and build your back office on a foundation of clarity.