Add a New Employee to the Payroll

Key Points

  • To ensure that amounts for applicable taxes and other deductions are properly withheld from an employee's first paycheck, an employer must determine how the employee will be paid (i.e., salaried or hourly); how often the employee will be paid (i.e., biweekly or monthly); and the best method by which to pay the employee (i.e., paper check, direct deposit or paycard).
  • An employer must also determine federal, state and any local income tax withholding from the employee's pay; the taxability of the value of any health care or fringe benefits in which the employee may enroll; whether the employee's pay is subject to deductions under a child support or garnishment order or a tax levy; and whether the employee has chosen to have any additional, voluntary deductions withheld from their pay (i.e., to pay off a student loan).
  • An employer is also required by law to verify and keep records of a new employee's right to work in the US and their Social Security or Taxpayer Identification Number; and report the employee to the appropriate state directory of new hires.

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