Hiring across state lines is the single most common compliance trap we see at Cadent. Before that first out-of-state paycheck goes out, you need:
1. State withholding account
Every state with income tax requires you to register as a withholding agent. Some let you file online same-day (Texas, Florida have no income tax, so skip this step); others (looking at you, Pennsylvania) take 2–4 weeks.
2. State unemployment insurance (SUI)
Separate registration, separate account number. Most states tie it to your federal EIN but you still need to file the form. New employer rates vary wildly. California starts you at 3.4%, others closer to 1%.
3. Local taxes
Ohio, Pennsylvania, Kentucky, Indiana, and a handful of others have local income taxes: city, school district, occupational. If your employee lives or works in one, you have to register and remit there too.
4. Workers’ compensation
Most states require coverage from the first employee. A few (Texas) make it optional. Either way, sort the policy before payday, not after.
5. New-hire reporting
Federal law requires every new hire to be reported to the state’s new-hire directory within 20 days. Each state has its own portal.
6. State-specific notices
Many states require posted workplace notices (minimum wage, anti-discrimination, paid leave). Remote employees? You still need them posted electronically.
7. Pay frequency rules
States dictate how often you can pay. California requires semi-monthly minimum for most workers; New York has industry-specific weekly rules.
Short version: budget 2–4 weeks per new state for clean registrations. Or, we can do this for you in parallel while you focus on hiring.
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