Congratulations on your decision to become a Texas new employer! You will need a few things in place before you run your first payroll. For Texas employer registration help, check out our partner, CorpNet.
Federal and State Tax Accounts
Federal Tax Accounts:
Apply for an EIN View Details
Apply for an EIN (Employer Identification Number) with the IRS online.
The IRS will assign you a unique nine-digit number to identify your business.
To read more about applying for an EIN, read our help article, “Your Step-by-step Guide on How to Apply for EIN.”
Enroll in EFTPS View Details
Although it is not required, we recommend you enroll in the Electronic Federal Tax Payment System (EFTPS). You can register online for the EFTPS.
You will be able to pay taxes yourself or view payments made on your behalf with the Electronic Federal Tax Payment System (EFTPS).
To find out more, please read our article, “What Is EFTPS?“
State of Texas Tax Accounts:
Register With the Texas Workforce Commission View Details
Texas new employers must register their business for a state unemployment insurance account (SUI) within 10 days of becoming liable.
You can register online with the Texas Workforce Commission for a TWC number.
This number is a nine-digit number with the following format XX-XXXXXX-X. You will need your Employer Identification Number and ID issued for your company by the Texas Secretary of State.
For more information, please visit the Texas Workforce Commission or email [email protected].
Get Your SUTA Rate View Details
Texas new employers use either the average rate for employers in their NAICS code or 2.7%, whichever is higher. For more information, please visit the Texas Workforce Commission.
You will be given a new State Unemployment Tax Assessment rate every year after you have become an established employer by paying for four chargeable quarters.
To learn more about SUTA, please read our article, “What Is SUTA Tax?”
State-mandated Insurance:
Sign up for Workers’ Comp Insurance (Voluntary) View Details
Workers’ comp insurance is not required in Texas. However, the state recommends carrying workers’ comp to protect your business from most lawsuits by injured employees.
Patriot’s online payroll offers free pay as you go (PAYG) workers’ comp integration with our partner, ERGO NEXT Insurance. You can get a free quote with ERGO NEXT here.
Setting Up Your New Employee:
Fill Out Form I-9 View Details
Fill out the required Form I-9 for employee verification for working in the USA.
This is a two-part form. The first section is to be completed by the employee and the second half is to be completed by the employer. To learn more, please read, “Form I-9 In a Nutshell.”
You must retain each employee’s completed Form I-9 as long as the individual works for you. For more information please read, “What Should Be in an Employee File?”
Have Employee Fill Out Federal Form W-4 View Details
Employees need to fill out the federal Form W-4, Employee’s Withholding Certificate for federal income taxes.
For more information, read our help article, “What Is a W-4 Form, and What Is it Used for?“
Report New Hire View Details
Federal and state laws require employers report every new employee they hire. You must report new hires within 20 days to the Attorney General of Texas New Hire Reporting Center.
For more information, please read, “What Is New Hire Reporting?“
Meet Minimum Wage Requirements View Details
Texas follows the federal minimum wage of $7.25 per hour.
You will need to display the minimum wage poster for your employees, as required by law.
Obtain Labor Law Posters View Details
Get annual posters and all federal, state, county, and city labor law updates with Patriot’s labor law poster store, powered by PosterElite!
Once you have all the necessary information, you will be able to set up your payroll for your business.
You will want to keep all payroll records for at least three years. For more information please read our help article, “What Employers Should Know About Employee Payroll Records.”
Let us know if you have any questions. We are here to help!
This is not an all-inclusive list for new employers in Texas. Please check with state and federal governments for more details.