If you think it could be time to hire your first employee, it\u2019s an exciting but also stressful time.<\/p>\n
It can be exciting because perhaps you feel like your business has gotten to the point where you\u2019re expanding, and you can take on the responsibilities of paying an employee. At the same time, there are a lot of things you have to do legally when you hire someone.<\/p>\n
For example, you have to be aware of workers\u2019 compensation guidelines where you live. Workers\u2019 comp is something employers pay for and it\u2019s managed at the state level, so workers\u2019 comp insurance in New Jersey<\/a> is going to be different from Florida, and both will be different from California. Not every state requires you to have workers\u2019 comp for just one employee, but some do. This is just one of many things you have to think about.<\/p>\n The following are important things to know before you hire your first employee.<\/p>\n When you\u2019re planning to hire an employee, you need to think about the costs beyond just their salary. You\u2019ll have to pay state payroll taxes and unemployment taxes, as well as workers\u2019 compensation and potential benefits. You\u2019ll also have overhead to consider, like their equipment and workspace expenses.<\/p>\n Are you going to hire a full-time employee, or in your current situation, would it make more sense to hire a part-time or contract employee?<\/p>\n One of your first steps, when you\u2019re hiring your first employee is to first get an employer identification number or EIN. You\u2019ll use this on documents, including your tax returns submitted to the IRS. If you need to get an EIN, you fill out the SS-4 form from the IRS. You can download the form online from the website of IRS.<\/p>\n An EIN is similar to a Social Security number for businesses. You might already have one, depending on your operational structure.<\/p>\n Every state has its own process to register for an employer identification number<\/a>, and you can learn more about the specifics by going to the labor department\u2019s website in your state.<\/p>\n Once you have an EIN, you can start to think about how you\u2019ll manage your taxes. You\u2019ll have to withhold part of the salary or pay of your first employee for Medicare and Social Security. You\u2019re also responsible for sending it to the IRS.<\/p>\n You\u2019ll need to keep all of your tax records related to your employees for at least four years, and you\u2019ll need to set up your federal tax withholding, federal wage and tax statement, and state taxes.<\/p>\n Go ahead and think about setting up a payroll system because this is going to be the easiest way to stay organized and manage withholdings.<\/p>\nAlso read:<\/span> Top 10 Marketplace For Selling Digital Products<\/a><\/span>\n Once you\u2019ve got the tax specifics out of the way, you can start to think more about the role itself. You need to know the support you need and the ideal candidate for the position.<\/p>\n This is when you\u2019re going to build out a detailed list of the responsibilities you hope the person will be taking on. You\u2019ll also get more specific about what you\u2019re going to pay for the position, and once you\u2019ve figured these things out, you can write a job description.<\/p>\n After you define the role, you can start to post the job opening.<\/p>\n You want to cast a pretty wide net to help you find the best-qualified candidate, and this might mean posting on a range of sites like LinkedIn and Indeed. You also have to make sure to include a statement at the end of your post indicating you\u2019re an Equal Opportunity Employer.Set a Budget<\/h2>\n
Get An EIN<\/h2>\n
Define the Role<\/h2>\n
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