How to Do Payroll in New York

Last reviewed: July 2026

1. Get a Federal EIN

Before you touch anything state-specific, you need a federal Employer Identification Number (EIN) from the IRS. It is free, and you can apply online in about ten minutes if your business is a U.S. entity with a responsible party who has a Social Security number or ITIN. The EIN identifies your business on every federal filing — Form 941, Form 940, W-2s — and every New York agency will ask for it too.

If you already have an EIN from a prior business or a sole proprietorship, do not reuse it for a new legal entity. A new corporation, partnership, or LLC generally needs its own number, and mixing them up creates headaches later when the IRS or New York DOL tries to match records.

2. Complete Your New York State Registrations

With an EIN in hand, register with two separate New York agencies. They are not the same office, and each issues its own account number.

• New York State Department of Taxation and Finance — handles income tax withholding registration. Register at tax.ny.gov to receive your withholding identification number.
• New York State Department of Labor — handles your unemployment insurance (SUI) account. Register through the DOL's employer portal at dol.ny.gov. Most employers use Form NYS-100 to register for UI, withholding, and wage reporting together.

Alongside those two, arrange workers' compensation insurance and disability benefits/Paid Family Leave (PFL) coverage. New York requires nearly all employers with even one employee to carry workers' comp, and disability/PFL coverage is typically bundled through the same private carrier. If your business operates in one of the counties subject to the Metropolitan Commuter Transportation Mobility Tax (MCTMT), you'll also register separately for that payroll expense tax once your payroll crosses the applicable threshold.

3. Collect Withholding Certificates and Set Up State Tax

Every employee fills out a federal Form W-4 and a New York Form IT-2104, Employee's Withholding Allowance Certificate. The IT-2104 tells you how much state (and, where applicable, New York City or Yonkers) income tax to withhold from each paycheck. Keep completed forms on file — you don't file them with the state, but you need them if the Department of Taxation and Finance ever asks.

Run withholding calculations using the New York withholding tables published by the Department of Taxation and Finance, which update periodically. Most payroll software applies these automatically once you tell it an employee's IT-2104 details and work location.

4. Register for and Fund SUI

State Unemployment Insurance (SUI) is funded entirely by the employer — employees never see a SUI deduction on their pay stub. New employers in New York generally pay a standard new-employer rate until enough claims history accumulates to calculate an individual experience rate. For 2026, that new employer rate is 4.1%, applied to a taxable wage base of $17,600 per employee.

You'll file SUI along with withholding and wage reporting on the combined Form NYS-45 each quarter. Set up your DOL online account early so you're not scrambling to file your first return.

5. Choose a Pay Frequency and Handle Final Pay

New York's pay frequency rules depend on how a worker is classified. Manual workers — anyone spending more than 25% of their time on physical labor — must be paid weekly, within seven calendar days after the end of the week the wages were earned, under Labor Law Section 191. Clerical and other workers can generally be paid semi-monthly or more often, as long as paydays are regular and designated in advance.

This weekly-pay rule for manual workers trips up a lot of new employers, especially retail, food service, and construction businesses that assume a standard biweekly cycle applies to everyone. Check how each role is classified before you lock in a pay schedule — getting this wrong has led to significant class-action exposure for New York employers in recent years.

When someone leaves, New York requires final wages to be paid no later than the next regular payday, whether the separation was voluntary or not. There's no rule requiring an immediate on-the-spot final check the way some states mandate, but don't hold pay past the next scheduled payday.

6. Follow the Deposit and Filing Calendar

New York payroll compliance runs on two overlapping calendars: federal and state.

• Federal deposits: Withhold and deposit federal income tax, Social Security, and Medicare through EFTPS on a schedule the IRS assigns (monthly or semiweekly), and file Form 941 quarterly.
• State withholding deposits: The Department of Taxation and Finance assigns your state withholding deposit schedule based on the size of your payroll, with due dates that often mirror the federal cadence.
• Combined quarterly return: File Form NYS-45 (covering withholding, wage reporting, and SUI together) by the last day of the month following each quarter — April 30, July 31, October 31, and January 31.
• New hire reporting: Report every new or rehired employee to the New York State New Hire Notification Program within 20 calendar days of the hire date.

7. Close Out the Year with W-2s

At year-end, issue Form W-2 to every employee by January 31, showing federal, state, and (where applicable) New York City or Yonkers wages and withholding separately. File copies with the Social Security Administration and, for state purposes, with the Department of Taxation and Finance as part of your annual reconciliation.

If you paid any independent contractors $600 or more during the year, issue Form 1099-NEC by the same January 31 deadline. Reconcile your total wages reported on your four NYS-45 filings against your W-2 totals before you close the books — discrepancies here are one of the most common triggers for a state inquiry.

Once your registrations, pay schedule, and filing calendar are set up correctly, payroll becomes a routine you repeat every pay period rather than a project you rebuild from scratch. Use the paycheck calculator to check net pay on individual checks, and point new hires to the W-4 helper so their withholding elections are accurate from day one. For the federal side of the equation, the Form 941 guide walks through your quarterly federal return in detail.

Most small businesses eventually hand this off to software rather than tracking every deadline by hand. Gusto handles federal and New York state filings together, calculates the right withholding from each employee's IT-2104, and keeps your SUI and NYS-45 filings on schedule automatically.

FAQ

How do I do payroll in New York for the first time?

Get a federal EIN, register with the New York Department of Taxation and Finance for withholding, register with the New York Department of Labor for unemployment insurance, set up workers' compensation and disability/paid family leave coverage, and pick a pay schedule that meets New York's frequency rules. Then run payroll on a regular schedule and file the required quarterly and annual returns.

How often do I have to pay employees in New York?

It depends on the employee's classification. Manual workers must be paid weekly, within seven calendar days after the end of the week in which the wages were earned. Clerical and other workers must generally be paid at least semi-monthly, on regular paydays designated in advance by the employer.

What tax do I withhold from New York employee paychecks?

You withhold federal income tax, Social Security, and Medicare, plus New York State income tax based on the employee's Form IT-2104. If the employee works in New York City or Yonkers, you also withhold the applicable city tax. Employees in the MCTMT zone counties may see the Metropolitan Commuter Transportation Mobility Tax addressed separately at the employer level rather than through payroll withholding.

When are New York payroll taxes due?

State withholding deposits follow a schedule assigned by the Department of Taxation and Finance based on your total withholding, similar in structure to the federal deposit schedule. Combined quarterly returns (Form NYS-45, covering withholding, wage reporting, and unemployment insurance) are due the last day of the month after each quarter ends: April 30, July 31, October 31, and January 31.

Do I need to report new hires in New York?

Yes. New York employers must report every newly hired or rehired employee to the New York State New Hire Notification Program within 20 calendar days of the hire date. Reporting can be done online, and failing to report can result in fines.