Looking for what to set up when hiring in Texas? Steven Palmieri, a Tax CFO, keeps the list short on purpose. A few registrations come before the first paycheck, one report follows the first hire, and a payroll provider handles most of the rest once it is set up.
An employer in Texas registers with the Texas Workforce Commission for unemployment tax. The window is short, ten days from the point at which the business becomes liable. The tax is an employer cost. It is not taken from wages, so it does not appear on an employee's paystub as a deduction. It is a line in the business's own budget.
For 2026, the taxable wage base is the first $9,000 of each employee's pay, and a new employer starts at 2.70 percent. The year sits next to every figure because both can change. Each quarter, the employer files a report and pays the tax.
Employers report new hires to the Office of the Attorney General within 20 calendar days of the hire date. Most payroll providers can do this when the new employee is entered, which is one more reason to set the provider up before the first hire and not after.
Texas has no state income tax, so there is no state income tax withholding on a paycheck. That removes a line from payroll setup. It does not touch federal withholding, Social Security and Medicare, or federal deposits, which apply as usual and which the payroll provider handles on schedule once the account is set up. The page on no state income tax in Texas explains what that leaves on the list.
Texas lets most private employers decide whether to carry workers' compensation, and both choices bring duties, including notice to employees about coverage. We do not advise on the choice. We show what each option does to the monthly cost, so the decision rests on a cash view, and your insurance agent or an attorney speaks to the rest.
Payroll setup is what we do. Our part is helping you choose the provider you will run, registering the business, setting the owner's pay and each employee's, linking the provider's feed to the books and watching what is due each quarter and each year. The provider pays your people and makes the deposits, and we never process payroll ourselves. A company with locations in several cities can tag payroll by location in the books, so labor costs are visible where they occur.
Say a company adds a first employee at $52,000 a year. This is an illustration. The cost to the business goes beyond the wage. It includes the employer's share of payroll taxes, the unemployment tax on the first $9,000 of pay in 2026, any insurance, and the time the provider needs to run the account. We lay those out as a monthly figure before the offer goes out, so the owner knows what the hire costs per month. Nothing in this paragraph is a quote or a promise.
The Texas date this page puts on your plan is the ten-day window after the business becomes liable, when the Workforce Commission registration has to be done. After that, the quarterly report becomes the recurring date.
Get your first Texas payroll set up right with us on a free Second Look call. No paperwork and no payment. If you are relocating a team, see moving a company to Texas for the sequence.
You will be talking to the Steven Palmieri practice.