Being summer savvy means planning how to handle summer hires, their paperwork and their questions. Instead of seeing red, use this checklist to bring order to the summer hiring process.
√ Require new hires to present their Social Security cards, and use the Social Security Administration’s Social Security Number Verification Service to verify that their names and Social Security numbers match.
√ Photocopy new hires’ Social Security cards for W-2 purposes. Don’t put anyone on the payroll who doesn’t present his or her Social Security card.
√ Make sure to report new hires to the proper state agency.
√ Provide W-4s to new hires who have never worked for the company. Rehires who worked for the company this year, and who received early W-2s, will also have to file new W-4s. Rehires who worked for the company this year, but who didn’t receive early W-2s, need not file new W-4s.
√ Eliminate the I-9 verification process for rehires, if rehiring occurs within three years of the original verification, you’re sure they’re the same people, the original I-9s show they can work in the U.S. and you update section 3. Heads up: Rehires who didn’t complete I-9 forms with a rev. date of 03/08/13 must file new forms and be reverified.
√ Enroll summer hires in your direct deposit or paycard program, and provide them with appropriate explanatory material.
√ Don’t enroll summer hires in your health and retirement plans; provide summer hires with the appropriate opt-out forms if you have auto-enrollment cafeteria and 401(k) plans.
√ Students probably aren’t exempt from federal income tax withholding. To find out, provide them with IRS Pub. 505, which is available at the IRS website. However, they may be exempt from state withholding, so have state W-4 forms for them to complete.
√ If you decide to hire your children, document their work thoroughly to avoid suspicion that you’re deducting their allowance as a salary expense; pay them when other employees are paid and what other employees with comparable duties are paid.
√ Sole proprietors or members of spousal partnerships who hire their children may not owe FICA or FUTA on their wages. Children younger than 18 who work in their parents’ business are exempt from FICA and FUTA; children between the ages of 18 and 20 are exempt from FUTA.
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