Understanding New Employer Reporting Requirements for New York State

As of January 1, 2022, New York employers must report new hires who are listed as independent contractors and have contracts worth more than $2,500 to the New York State Department of Taxation and Finance.

Previously, you were not mandated to include independent contractors under the state’s new hire reporting requirement; now you’ll have to add them to the list of other new hires or rehires to report.

If your organization falls into one of the following categories, you’re required to report your new hires for tax purposes:

• Labor organizations, including union-operated placement offices (I.e., hiring halls),
• Employers of individuals performing domestic services,
• Government entities excluding federal agencies.

Your organization will have to report those new hires or rehires, including independent contractors, within 20 calendar days from the date hired. The hiring date is defined as the first day the employee or contractor:

• Is eligible to collect commissions for any job performed based only on commissions,
• Completes the services for which they will be paid (collecting tips, wages, commissions, or another agreed-upon compensation).

If you are an employer looking for clarification regarding additional reporting requirements in New York State (including how to actually file), please contact MGO’s tax team to talk to an advisor who can comprehensively walk you through the steps and ensure you avoid any missteps that could affect your organization.