Is an employer required to obtain state identification numbers?
Generally, yes. Although some states do not have individual income tax, which eliminates the need to withhold state income taxes from an employee, all states maintain some form of unemployment insurance. Generally, an employer is required to apply for both income and unemployment tax identification numbers in the states for which they have employees. Each state's application process is different. For example, some states do not issue an ID number until after the first time wages have been paid, while others require the employer apply for the number in advance. For more information of your state's income and unemployment tax identification number application process, please visit our state section and select the state in which you have employees.