What Church Treasurers Should Know about “New Hire” Reporting

Federal law requires employers to report certain information about new employees.

Background. Churches are subject to new hire reporting requirements, mandated by Congress as part of comprehensive welfare reform legislation enacted a few years ago. This article will explain the application of the new reporting requirements to churches.

What is new hire reporting? New hire reporting is a procedure used by employers to report information about all new hires to a designated state agency. The purpose of the reporting requirement is to lower welfare costs by increasing child support collections and reducing welfare and food stamp payments. Another purpose is to reduce fraudulent unemployment benefits payments to persons who are working.


Key point. Technically, states are not required to mandate new hire reporting. But, if they fail to do so, they will forfeit federal funding under certain programs. To date, all states have enacted legislation mandating new hire reporting.

Why is new hire reporting necessary? New hire reporting facilitates the collection of child support from parents who change jobs frequently to avoid paying child support. It also will be used to detect and prevent erroneous welfare and unemployment benefits payments.

How will the information be used? When employers (including churches) report new hire information to their designated state agency, the agency will match the information against its own child support records to locate parents and enforce existing child support orders. Once these matches are done, the information is sent to the “National Directory of New Hires,” so other states can compare the information with their own child support records. The information also will be shared with state welfare and unemployment agencies, to detect and prevent fraudulent or erroneous payments.

Are churches exempt from the new hire reporting requirements? No, they are not. The new hire reporting requirements apply to all “employers.” The new law defines the term “employer” as “the person for whom an individual performs or performed any service, of whatever nature, as the employee of such person.” There is no exception for religious organizations. And, there is no exception for “small” employers having only one or two employees. But remember—reporting is only for new hires, as defined by state law. This generally will be any employee hired after a date specified by state law.

What are the penalties for not reporting? The federal welfare reform law prohibits states from assessing a penalty in excess of $25 for each failure to report a new hire. However, states may impose a penalty up to $500 if an employer and employee “conspire” to avoid the reporting requirements, or agree to submit a false report.

What information must be reported? The federal welfare reform legislation requires that employers include the following information in their new hire reports:

  • employee’s name
  • employee’s address
  • employee’s social security number
  • employer’s name
  • employer’s address
  • employer’s federal employer identification number (EIN)

Note that most of this information is contained on the W-4 form (“withholding allowance certificate”) completed by each new employee at the time of hire, and as a result most states allow employers to comply with the reporting requirements by sending a copy of each W-4 form completed by a newly hired employee.


Tip. The employer’s federal identification number is inserted on line 10 of Form W-4 only when the form is sent to the IRS. Since this happens infrequently, the employer’s identification number generally does not appear on the form. So, for an employer to use W-4 forms to comply with the new hire reporting requirements, it must manually insert its federal employer identification number (EIN) on line 10. The employer’s name and address also may need to be manually inserted on line 8.


Key point. Some states ask employers to voluntarily report additional information, such as date of hire, or medical insurance information.

What is the deadline for filing a new hire report? The deadline is specified by state law. However, it may not be later than 20 days after an employee is hired.

How do we make a new hire report? Most states allow employers to comply with the new hire reporting requirement in any one of three ways:

Electronic or magnetic reporting. Some states permit employers to report by electronic file transfer (EFT); file transfer protocol (FTP); magnetic tape; or 3.5″ diskette.

Fax or mail. Most states permit employers to fax or mail any one or more of the following:

(1) A copy of a new employee’s W-4. Be sure it is legible, and that the church’s federal employer identification number (EIN) is included on line 10. Also be sure that the church’s name and address are included on the form.

(2) A printed list.

(3) A new hire reporting form provided by your designated state agency.


Tip. If your church hires new employees infrequently, the easiest way to comply with the reporting obligation may be to use the state reporting form. Simply complete one form with your federal employer identification number, name, and address, and then make several copies. This way, you will only need to add an employee’s name, address, and social security number when a new employee is hired.

Voice reporting. In some states, employers can report new hires by leaving a voice message on a special voice response system.


Tip. Be sure to check with your designated state agency to find out what reporting options are available in your state. Telephone numbers for all state agencies are included in a table in this newsletter. Use the option that is easiest for you.


Tip. Does your church use a payroll reporting service? If so, it may be automatically making the new hire reports for you. Check to be sure.

What about privacy concerns? Federal law requires each state to implement safeguards to protect the confidentiality of new hire reports. In addition, all data transmitted by states to the National Directory of new Hires is done over secure and dedicated lines.

Telephone Numbers of Designated State Agencies StateTelephoneStateTelephoneStateTelephone

AL334-353-8491KY800-817-2262ND800-755-8530
AK907-269-6685LA888-223-1461OH800-208-8887
AZ602-252-4045ME207-287-2886OK800-317-3785
AR501-682-3087MD888-634-4737OR503-986-6053
CA916-657-0529MA617-577-7200PA888-724-4737
CO303-297-2849MI800-524-9846RI888-870-6461
CT860-424-5044MN800-672-4473SC800-768-5858
DE302-369-2160MS800-866-4461SD888-827-6078
DC888-689-6088MO800-859-7999TN888-715-2289
FL904-922-9590MT888-866-0327TX888-839-4473
GA888-541-0469NE888-256-0293UT801-526-4361
HI808-586-8984NV888-639-7241VT802-241-2194
ID800-627-3880NH888-803-4485VA800-979-9014
IL800-327-4473NJ609-588-2355WA800-562-0479
IN800-437-9136NM888-878-1607WV800-835-4683
IA515-281-5331NY800-972-1233WI888-300-4473
KS888-219-7801NC888-514-4568WY800-970-9258

Richard R. Hammar is an attorney, CPA and author specializing in legal and tax issues for churches and clergy.

This content is designed to provide accurate and authoritative information in regard to the subject matter covered. It is sold with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional person should be sought. "From a Declaration of Principles jointly adopted by a Committee of the American Bar Association and a Committee of Publishers and Associations." Due to the nature of the U.S. legal system, laws and regulations constantly change. The editors encourage readers to carefully search the site for all content related to the topic of interest and consult qualified local counsel to verify the status of specific statutes, laws, regulations, and precedential court holdings.

ajax-loader-largecaret-downcloseHamburger Menuicon_amazonApple PodcastsBio Iconicon_cards_grid_caretChild Abuse Reporting Laws by State IconChurchSalary Iconicon_facebookGoogle Podcastsicon_instagramLegal Library IconLegal Library Iconicon_linkedinLock IconMegaphone IconOnline Learning IconPodcast IconRecent Legal Developments IconRecommended Reading IconRSS IconSubmiticon_select-arrowSpotify IconAlaska State MapAlabama State MapArkansas State MapArizona State MapCalifornia State MapColorado State MapConnecticut State MapWashington DC State MapDelaware State MapFederal MapFlorida State MapGeorgia State MapHawaii State MapIowa State MapIdaho State MapIllinois State MapIndiana State MapKansas State MapKentucky State MapLouisiana State MapMassachusetts State MapMaryland State MapMaine State MapMichigan State MapMinnesota State MapMissouri State MapMississippi State MapMontana State MapMulti State MapNorth Carolina State MapNorth Dakota State MapNebraska State MapNew Hampshire State MapNew Jersey State MapNew Mexico IconNevada State MapNew York State MapOhio State MapOklahoma State MapOregon State MapPennsylvania State MapRhode Island State MapSouth Carolina State MapSouth Dakota State MapTennessee State MapTexas State MapUtah State MapVirginia State MapVermont State MapWashington State MapWisconsin State MapWest Virginia State MapWyoming State IconShopping Cart IconTax Calendar Iconicon_twitteryoutubepauseplay
caret-downclosefacebook-squarehamburgerinstagram-squarelinkedin-squarepauseplaytwitter-square