The first hire converts a business into an employer, with payroll tax, insurance, and record-keeping duties attached at both federal and state level.
Classification first
Whether someone is an employee or an independent contractor depends on control and relationship, not on what the contract calls them. Agencies apply their own tests.
Set up the machinery
Register for state payroll accounts, collect the required onboarding forms, arrange workers' compensation cover, and run payroll through a provider that files on your behalf.
- Federal and state payroll registrations
- Employment eligibility verification and tax forms
- Workers' compensation insurance
- Written offer letter and employee handbook