Your First Employee: The Payroll Setup a Stratford Business Needs Before the First Pay Run

The short answer

Four registrations and one insurance policy come before the first paycheck. Start with the EIN, since later forms ask for it: the employer section of Connecticut Form CT-W4, for one, has a box for the federal number.

A new shop in Paradise Green hiring a first counter worker and a small firm near Sikorsky Memorial Airport hiring a parts runner face the same list.

The rules below are as each agency publishes them, checked in October 2026.

What do you register for?

The EIN

The IRS EIN page lists hiring employees as a reason a business needs one, and warns that you never have to pay a fee for one, so beware of websites that charge.

Connecticut withholding and unemployment tax

The DRS new employer page says a business with an office in Connecticut, or one that transacts business here, must withhold Connecticut income tax if it counts as an employer for federal withholding, and must register to do it. The same page reminds employers to register separately with the Department of Labor for unemployment tax.

The Department of Labor employer guide says all employers with one or more employees, full or part time, must register on ReEmployCT.

CT Paid Leave

The CT Paid Leave employer page says every covered employer must register, even when a payroll provider enrolled the business in a batch. According to the CT Paid Leave contributions page, the 2026 rate stays at 0.5% of an employee's pay, up to the Social Security wage limit. The employer page adds that there's no employer match. Per that employer page, the contribution comes out of the employee's pay and goes to the Authority each quarter, so it shows on the new hire's pay stub.

Workers' compensation

The Workers' Compensation Commission insurance page says that with few exceptions, every Connecticut employer must carry workers' compensation insurance.

What does the new hire fill in?

Three forms. The IRS hiring employees page says to ask every new employee for a signed Form W-4 when they start. Connecticut's own version is Form CT-W4, and its instructions say you keep one on file for each employee. For Form I-9, the USCIS Section 1 page says the employee signs Section 1 no later than their first day of employment. The USCIS Section 2 instructions then give the employer 3 business days from the first day of work for pay, so a Monday start means Thursday. A job lasting under 3 days needs it by day one.

1. Before day one, confirm everything in the first table is in place.
2. On day one, the new hire signs Form W-4, Form CT-W4 and Section 1 of Form I-9.
3. Within 3 business days of the first day of work for pay, Section 2 of Form I-9 is due, or by day one if the job lasts less than 3 days.
4. At hire, give the Notice of Employee Rights under CT FMLA and CT Paid Leave.
5. Report the new hire to the Connecticut Department of Labor, using the timing note below.
6. Before the first pay run, the 0.5% CT Paid Leave deduction is in place.

On step five, the state's own papers disagree. The Department of Labor guide says 14 days online or 20 by fax or mail, while the CT-W4 instructions say 20 days. Confirm with the department which one applies to you. The notice in step four comes from the CT Paid Leave employer steps, which require it at hire and every year after.

Which situation are you in?

The Department of Labor guide says a sole proprietor, or a single-member LLC run as one, is not an employee for unemployment tax. The IRS paying yourself page says a corporate officer is generally an employee. The IRS family employees page says a child under 18 working in a parent's sole proprietorship is subject to income tax withholding, but pay to a child under 18 isn't subject to Social Security and Medicare. For Connecticut unemployment tax, the Department of Labor guide says a sole proprietor's children under 21 aren't employees. That guide also says a contractor whose services are worth $5,000 or more over any twelve months must be reported as a new hire, unless they're registered with the department or work for a registered employer. Whether a helper is truly a contractor turns on the worker test, which our post on how the employee or 1099 contractor test works walks through.

What comes due after the first pay run?

The filings below repeat. Dates come from the IRS employment tax due dates page, the DRS withholding tax page and the Department of Labor guide. Connecticut requires every withholding payment and form to go in electronically.

Your lookback period decides whether federal deposits are monthly or semiweekly.

Where we fit in

We run payroll for small businesses, including 1099s, from our office at 77 Canoe Brook Rd in Trumbull. Our Stratford bookkeeping and tax page lists what we cover there.