All posts by Adam Lewis

Mergers and acquisitions (M&A) can unlock growth opportunities—but they also bring complex employment tax challenges. Missteps in handling state unemployment insurance (SUI), succession status, and taxable wage carryovers can lead to costly penalties and compliance headaches. The good news? With proactive planning and clear processes, you can minimize risk and maximize tax benefits. Below are 15 practical tips for managing employment tax during M&A transactions. These guidelines are not a substitute for legal or tax advice. Before the Deal Closes 1. Gather Historical Data Best practices is to secure at least three years of wage and tax records, filings, and SUI rate notices for the target company. Obtain signed releases from target company officers to access agency records. 2. Confirm Deal Structure Is it a stock or asset transaction? If asset-based, is it partial or total? Will any officers transition to the new entity? 3. Lock Down Key Dates Document the transaction date and any employee migration dates. If employment continuity is broken, note the gap between last payroll at the target and first payroll at the new entity. Start Strong 4. Perform Succession Analysis Determine if you qualify as a successor employer for federal and state jurisdictions. Rules vary by state. 5. Notify Agencies Early Inform state and local agencies of changes in control, officers, or employing entity promptly. 6. Open New Accounts Establish new accounts (SUI, SIT, local taxes) in alignment with prior reporting. 7. Review SUI Transfer Rules Understand each state’s UI Transfer of Experience requirements and notify agencies immediately after the event. 8. Assess SUI Rate Impact Evaluate how the transfer of experience affects your unemployment insurance rate—up, down, or neutral. 9. Determine Taxable Wage Treatment Confirm if you can carry forward taxable wages from the target company for the current year. 10. Document Everything Send correspondence via certified mail with return receipt. Track all communications and store confirmations. 11. Get Written Confirmation Secure written agency confirmation for key decisions like succession status and transfer of experience. Clean Up Post-Close 12. Close Target Company Accounts Shut down local, state, and federal employment tax accounts promptly to avoid estimated liabilities. 13. Check for Credits Review target company accounts for unused tax credits or prior contributions that may be recoverable. 14. Clear Outstanding Balances Contact agencies to confirm there are no unresolved balances or reporting issues. Finish Strong 15. Follow Up Relentlessly Agency delays are common. Follow up by phone and in writing until all decisions are finalized and confirmed in writing. Bottom Line Employment tax compliance during M&A doesn’t have to be overwhelming. By following these steps—and partnering with experienced advisors—you can reduce risk, avoid penalties, and ensure a smooth transition.

As employers enter 2026, many are discovering a hard truth: success is no longer determined by strategy or technology alone, but by the ability to execute consistently in an increasingly complex workforce environment. Our recent webinar with Madeline Laurano, Insights to Action: Resolutions for Employer Success, explores how HR, payroll, and compliance leaders can turn insight into measurable outcomes. Drawing on original research from Aptitude Research and real-world employer experiences, the webinar outlines the key trends shaping employer operations. Watch the webinar for actionable resolutions helping organizations reduce risk, improve compliance, and elevate the employee experience. Below is a recap of what we learned from Madeline. From Insight to Execution: Why 2026 Is a Turning Point for Employers The past several years have fundamentally reshaped employer operations. Organizations now manage workforces that span multiple states, employment types, and regulatory environments—all while facing growing compliance demands and pressure to do more with fewer resources. During the Insights to Action: Resolutions for Employer Success webinar, research revealed that most employers already have clear strategies in place. The real challenge lies elsewhere: execution. Employers struggle to apply those strategies consistently across locations, worker populations, and systems. Disconnected workflows, manual handoffs, and fragmented technology stacks create risk, inefficiency, and poor employee experiences. This webinar reframes the conversation for 2026, shifting the focus from planning and digital transformation to operational excellence. Key Workforce and Employer Trends Defining 2026 One of the central themes of the webinar is that employer success in 2026 will be defined by how well organizations manage complexity. Several key trends emerged: Operational Excellence Over Digital Transformation While technology investment has increased, results have not always followed. The webinar emphasizes moving beyond tool adoption to designing workflows that actually make work happen—consistently and compliantly. Automation With Guardrails Automation and AI continue to accelerate, but trust, transparency, and control are critical. Employers must ensure automation supports accuracy, compliance, and risk reduction—not just efficiency. Data as an Operational Asset Organizations are collecting more workforce data than ever, yet many struggle with data integrity and usability. The webinar highlights the importance of using data proactively to manage risk and improve decision-making, rather than treating it as static reporting. Embedded Services as a Competitive Advantage Research shows that service and domain expertise now outweigh product features in provider selection. Employers need partners who understand regulatory complexity and can actively support execution—not just software delivery. Compliance Moves Upstream Compliance is no longer a downstream, legal-only function. It directly impacts employee trust, brand reputation, and operational resilience. In 2026, compliance must be embedded into everyday workflows. Actionable Resolutions for Employer Success Rather than offering abstract predictions, the webinar delivers five practical resolutions employers can act on immediately: Design workforce operations around execution, not just strategy Simplify processes before automating to avoid scaling inefficiencies Make compliance part of the workflow, not a final checkpoint Treat employee experience as an operational outcome, not a soft metric Hold technology and service investments accountable to impact Together, these resolutions provide a roadmap for employers seeking to reduce risk, improve consistency, and deliver better outcomes for both the business and employees. Why This Webinar Matters Now As regulatory requirements expand and workforce models evolve, employers can no longer rely on reactive compliance or fragmented solutions. The Insights to Action webinar reinforces the importance of trusted partnerships, deep domain expertise, and services that help employers navigate change with confidence. For HR, payroll, and compliance leaders, this session offers more than insight—it offers a practical framework for success in 2026. Watch the Webinar On-Demand The Insights to Action: Resolutions for Employer Success webinar is available on demand through Experian Employer Services with expert insight from Madeline Laurano. Frequently Asked Questions (FAQ) What is the Insights to Action: Resolutions for Employer Success webinar about? The webinar focuses on how employers can move from strategy to execution in 2026 by addressing workforce complexity, compliance challenges, and operational inefficiencies. Who should watch this webinar? HR leaders, payroll professionals, compliance teams, and employer services decision-makers—especially those managing multi-state or complex workforces. What are the key takeaways from the webinar? Key takeaways include the shift to operational excellence, the importance of embedded compliance, automation with guardrails, and actionable resolutions employers can implement immediately. Does the webinar address compliance challenges? Yes. Compliance is a central theme, with guidance on embedding compliance into workflows to reduce risk and improve employee trust. Is the webinar available on demand? Yes. The session is recorded and available for on-demand viewing through Experian Employer Services. Get a head start on success in 2026 by speaking directly with one of our experts:

The U.S. government is ending the Temporary Protected Status (TPS) program for Somalia. The program and all its benefits will officially stop on March 17, 2026, at 11:59 p.m. What does it mean for employees? If you have an Employment Authorization Document (EAD), also known as a work permit under Somalia’s TPS, your card will expire on March 17, 2026. This applies to cards with any of the following "Card Expires" dates: March 17, 2026 September 17, 2024 March 17, 2023 What does it mean for employers (Form I-9)? You must take action to ensure your workforce remains legal. You must check the work authorization (reverify) of any employee using a Somalia TPS work permit before they start work on March 18, 2026 Look for cards labeled with category A12 or C19. Ensure every affected employee provides a new, valid document to continue working legally.

On January 30, 2026, the Internal Revenue Service released the final General Instructions for Forms W-2 and W-3 for the 2026 tax year. While much of the guidance builds on prior years, the final instructions reflect several important updates tied primarily to Public Law 119-21, the One Big Beautiful Bill Act (OBBBA), along with refinements from the draft instructions issued earlier in January. For employers, payroll providers, and HR teams, the 2026 instructions introduce new reporting codes, expanded data elements, and clearer explanations around how certain types of compensation must be reported, even where the underlying tax treatment has not changed. As always, organizations should evaluate how these updates apply to their specific circumstances. Below is a high-level summary of the most notable changes in the final 2026 instructions. This overview is for informational purposes only. Big picture: more granular reporting, not less responsibility Many of the 2026 updates focus on how information is reported, rather than whether it is taxable. In several areas, particularly tips and overtime, the IRS makes clear that while new deductions may be available at the individual level, employer reporting and payroll tax treatment largely remain the same. The result is more detailed W-2 reporting and a greater emphasis on accurate classification and data capture. Expanded reporting for tips The 2026 instructions introduce new reporting requirements related to tipped wages. A new Box 12 code, TP, must be used to report the total amount of cash tips reported to the employer. Box 14 has been split into Box 14a (Other) and Box 14b, with Box 14b dedicated to reporting Treasury Tipped Occupation Code(s) when tips are reported using code TP. Despite the new deduction for qualified tips under OBBBA, the final instructions reiterate that tips are generally subject to federal income tax withholding and both the employer and employee share of Social Security and Medicare taxes when the twenty-dollar-per-month threshold is met. This distinction underscores that deductions available on an individual’s tax return do not change employer withholding and reporting obligations. New reporting code for qualified overtime The final instructions introduce Box 12 code TT for reporting qualified overtime compensation. The IRS added clearer language than what appeared in the draft instructions. Only overtime compensation required under the Fair Labor Standards Act qualifies, and only the premium portion of overtime pay is reported. For example, in a time-and-a-half scenario, only the additional half of the overtime rate is reported using code TT. As with tips, the IRS clarifies that overtime compensation is still generally subject to federal income tax withholding and payroll taxes, even though certain deductions may apply at the individual level. Wage reporting threshold increase For wages paid after calendar year 2025, the wage reporting threshold increases from six hundred dollars to two thousand dollars when no federal income tax, Social Security tax, or Medicare tax is withheld. The threshold will be indexed for inflation beginning after 2026. This change may reduce reporting in limited situations, but it does not eliminate W-2 filing requirements where withholding occurs. Box 14 structural changes To accommodate new reporting needs, Box 14 has been split into Box 14a (Other) and Box 14b (Treasury Tipped Occupation Code[s]). Box 9 was reduced in size to allow for additional Box 14a entries. These layout changes may require payroll system updates to ensure accurate formatting and data placement. Trump account reporting Public Law 119-21 introduces Trump accounts, a new type of individual retirement account for children under age eighteen. For 2026 reporting, employers must use new Box 12 code TA to report employer contributions made under a Section 128 Trump account contribution program. Employer contributions may begin July 4, 2026, subject to annual limits and income exclusion rules. The final instructions provide less detail than the draft and direct employers to Publication 15-A for additional guidance. What changed from the draft instructions Compared to the draft issued earlier in January, the final instructions shortened and streamlined the discussion of Trump accounts, clarified that tips and overtime remain subject to payroll taxes, and added a concrete example explaining how only the premium portion of overtime pay qualifies for reporting under code TT. A note on interpretation This overview is intended for informational purposes only. Employers and individuals should review the full IRS guidance and verify how the rules apply to their specific facts and circumstances. Looking ahead The 2026 W-2 and W-3 instructions reflect a broader trend toward more detailed wage reporting, particularly for compensation types that may be subject to special deductions or increased scrutiny. For organizations, the focus will be on ensuring systems, data flows, and classifications align with updated requirements well before year-end reporting. Experian continues to monitor regulatory developments to help organizations stay informed as reporting requirements evolve. Connect today to learn how you can streamline your year-end tax compliance tasks to save time and improve your workflow.

Beginning March 19, 2026, Ohio’s new E‑Verify Workforce Integrity Act introduces major compliance requirements for employers engaged in non‑residential construction. The law expands verification obligations, increases penalties for violations, and tightens expectations for subcontractor oversight. Below is a breakdown of what the act requires and the steps employers should take now to prepare. Who Is Affected? The new law applies to employers (including contractors, subcontractors, and labor brokers) engaged in non-residential construction, including: Commercial building projects Road, highway, and bridge construction Utility and related infrastructure work The mandate does not apply to residential construction, manufactured homes, mobile homes, or agricultural‑use structures. What the E-Verify Workforce Integrity Act Requires Use E‑Verify for All New Hires. The new law does not replace federal Form I‑9 obligations. Employers must complete and retain I‑9s as required under federal regulations. Employers must keep all E‑Verify documentation for three years from the date of hire or one year after termination, whichever is later. Any employee who receives a Final Nonconfirmation in E‑Verify must be terminated. Violations may result in Fines starting at $250, increasing to $10,000 for repeated violations. Up to $1,500 for failing to create an E‑Verify case. Up to $25,000 for continuing to employ someone after a Final Nonconfirmation. Disqualification from state contracts for up to two years for multiple willful violations. Enforcement actions initiated by the Ohio Attorney General, including anonymous complaints. Recommended Employer Action Enroll in E‑Verify (if not already enrolled) and train responsible staff. Update onboarding workflows to ensure E‑Verify cases are opened promptly. Review contracts with subcontractors to confirm they meet E‑Verify obligations. Document your internal procedures for addressing Tentative and Final Nonconfirmation. Use Compliance Library to centralize policies, workflows, and subcontractor certifications. Staying ahead of these new E‑Verify Workforce Integrity Act requirements will help employers reduce risk and maintain compliance as enforcement ramps up. Schedule a meeting if you would like to learn more ways to prepare.

As we move into 2026, California employers are facing a wave of new compliance requirements. One of the most significant changes comes from Senate Bill 294 (SB 294), the "Workplace Know Your Rights Act." Signed into law in late 2025, this legislation introduces new notice and communication obligations that every employer in the state regardless of size must follow. "Workplace Know Your Rights Act" Compliance Requirements Starting February 1, 2026, all California employers are required to provide a stand-alone written notice to their employees detailing their workplace and constitutional rights. This isn't a one-time task; it must be distributed annually thereafter. The notice must cover several core areas, including information on workers’ compensation benefits, access to medical care, and disability wage replacement; protections against unfair immigration‑related practices such as retaliation or document abuse; employees’ right to receive advance notice when an immigration agency plans to inspect I‑9 employment eligibility records; constitutional rights during law enforcement interactions in the workplace, including the right to remain silent; labor rights such as the ability to organize a union or engage in protected concerted activity; updates on any new laws the Labor Commissioner considers significant; and contact information for the enforcement agencies responsible for safeguarding these rights. By March 30, 2026, employers must offer all employees the opportunity to designate an emergency contact specifically for cases of arrest or detention. You must ask employees if they want a specific person notified if they are arrested or detained at the worksite or during work hours (if the employer has actual knowledge of the event). Existing employees must be given this choice by March 30, 2026. For new hires after this date, the option must be provided during onboarding. Employers can deliver the notice via personal delivery, email, or text message, provided the employee is reasonably expected to receive it within one business day. The notice must be provided in the language the employer normally uses for employment-related communications and maintain proof of delivery (digital receipts, logs, or signed acknowledgments) for at least three years. The Labor Commissioner has already published model templates in English and Spanish. Penalties Failing to comply can lead to significant financial consequences. Employers may face penalties of up to $500 per employee for each notice‑related violation. Violations involving emergency contact requirements carry even harsher consequences, with fines of up to $500 per employee for every day the violation continues, capped at a maximum of $10,000 per employee. Action Plan for Employers Visit the California Department of Industrial Relations (DIR) website to get the latest template. Integrate the annual notice (February 1, 2026, deadline) and the emergency contact designation (March 30, 2026, deadline) form into your new hire packets immediately. Ensure you have a system in place to prove that every employee received their notice by the February 1st deadline. Ensure HR and supervisors understand the new protocols regarding employee arrests and detention to avoid costly daily penalties. Schedule a meeting to learn steps you can take to meet these new compliance requirements

On January 9, 2026, the Internal Revenue Service finalized the 2026 Form W-2, Wage and Tax Statement, formally implementing reporting changes required under Public Law 119-21, also known as the One Big Beautiful Bill Act (OBBBA). The final form largely reflects changes previewed in earlier drafts, with one important clarification related to tipped occupation reporting. While the final instructions have not yet been released, a draft version is available, and the form itself is now official. Employers should begin preparing systems and processes to support these updates ahead of the 2026 filing season. Key Changes in the Final 2026 Form W-2 New Box 12 Codes The finalized 2026 Form W-2 introduces three new Box 12 codes tied directly to OBBBA provisions: TA – Employer contributions under a section 128 Trump account contribution program paid to a Trump account of an employee or a dependent of an employeeTP – Total amount of cash tips reported to the employer that may be eligible for the OBBBA deductionTT – Total amount of qualified overtime compensation These codes support new above-the-line deductions that employees will calculate as part of their individual income tax filings. Box 14 Is Now Split Into 14a and 14b Box 14a – Other: Employers may continue to report miscellaneous informational items such as state disability insurance taxes, union dues, uniform payments, health insurance premiums, educational assistance, or other non-taxable income. Box 14b – Treasury Tipped Occupation Code(s): Employers will report up to two Treasury-issued tipped occupation codes that identify whether an employee’s role qualifies for the deduction for qualified tips. These occupation codes are used in combination with Box 12 code TP to determine tip deduction eligibility. Clarification on Code “000” in Box 14b One notable clarification was added in the final W-2 employee instructions. Only when Box 14b reports code “000” by itself does it indicate that an employee’s tips are not eligible for the OBBBA tip deduction. This distinction is important for employees with multiple tipped roles or occupation codes, ensuring that eligibility is not incorrectly disallowed due to partial or mixed reporting. Distinguishing Deductible vs. Non-Deductible Tips Earlier drafts introduced new reporting mechanics that are now reflected in the final form. Code TP is used to report cash tips when the employer is not a specified service trade or business (SSTB), and those tips may qualify for the deduction. Code TS applies to tips that do not qualify for the deduction when the employer is an SSTB, as defined under Internal Revenue Code sections 199A and 1202. Employers must correctly classify their business type and tip eligibility to ensure accurate reporting. Territorial Forms The IRS also released finalized versions of Form W-2AS (American Samoa) and Form W-2GU (Guam) on January 12, 2026. The finalized Form W-2VI (U.S. Virgin Islands) was not immediately available at the time of release. What This Means for Employers With the 2026 Form W-2 now finalized, employers should begin reviewing payroll systems, tip reporting processes, and occupation coding practices to ensure alignment with the new requirements. While the form itself is final, the final instructions have not yet been issued, and employers should continue monitoring IRS guidance for additional clarification. Looking Ahead The finalized 2026 Form W-2 represents a significant shift in wage reporting, particularly for tipped and overtime compensation. These changes increase reporting precision and reinforce the connection between payroll data and employee tax benefits under OBBBA. Employers that prepare early by validating data flows, updating payroll logic, and educating internal teams will be best positioned for a smooth 2026 filing season. View the final 2026 Form W-2: https://www.irs.gov/pub/irs-pdf/fw2.pdf Learn how Experian Employer Services can help with your year-end tax process and more:

On January 6, 2026, the Trump administration announced it will release only 35,000 supplemental H-2B visas for the year. This is nearly a 50% cut from the approximately 64,700 additional visas provided annually over the last three years. The Change: Every year, there is a "base cap" of 66,000 H-2B visas. Because this is rarely enough, recent administrations have added a "supplemental" batch of about 64,700 more. President Trump has reduced this extra batch down to 35,000. The Result: There will be roughly 30,000 fewer legal seasonal workers available nationwide compared to last year. Impact on Industries Various industries that often rely on H-2B workers may see changes in operations or ability to provide the same level of service if the reduction in visas translates to staffing shortages. These industries include hotel and hospitality, restaurants and bars, gas stations and convenience stores. Agriculture may also be affected, specifically landscaping and seafood. Field work typically relies on H-2A visas. Impact on Business Owners A smaller worker pool may result in higher wages to compete, driving up service prices. With demand far exceeding the 35,000 cap, many businesses may struggle to fill open positions, limiting their ability to operate at full capacity. Stricter "irreparable harm" standards mean businesses that lose the lottery face permanent financial loss.

WOTC renewal is a hot topic leading up to its expiration. Learn about potential legislative solutions and how to prepare for the potential of retroactive credits.

Maintaining accurate records is a cornerstone of workforce compliance. To help employers stay up to date, E-Verify recently reintroduced a convenient feature on January 5 that allows users to manage Point of Contact (POC) information directly within their accounts. Why This Update Matters Per the MOU, employers are required to maintain current contact information for all representatives associated with E-Verify. Keeping your POC information updated is the simplest way to meet this requirement, ensuring you receive critical program updates and maintain smooth communication with USCIS. Who can manage POCs: Program and Corporate Administrators can manage all company POC information. General users on employer agent accounts can also manage POC data for their clients. Access vs. Contact: Adding someone as a POC does not automatically grant them account access. To manage cases, they must also be added as a Program Administrator. The MOU Signatory: The original signatory is automatically designated as a POC. While they cannot be removed, their information can be updated. If the signatory leaves the company, ensure at least one active POC is assigned to the account. How to Update Your Info To review your records, log in and navigate to your Company Profile (for Program Admins) or Corporate Profile (for Corporate Admins) via the user menu. Employer agents can find this under the Clients menu. We encourage all users to log in at their earliest convenience to verify that their company’s POCs and users are accurate. Staying proactive today prevents compliance headaches tomorrow. For questions regarding these changes, contact the E-Verify team at e-verify@uscis.dhs.gov

As state and federal agencies ramp up efforts to curb unemployment fraud, employers are facing greater scrutiny and steeper consequences for compliance gaps. But fraud isn’t the only risk on the rise. The end of 2025 brought major regulatory shifts that impact tax credits, employment eligibility, and payroll compliance—making it critical for HR and payroll teams to approach 2026 with clear strategy and up-to-date tools. Watch the webinar on-demand: Don’t miss our combined session, “Dangers of UI Fraud” and the Q4 Regulatory & Legislative Update. You’ll get expert commentary on fraud trends, policy shifts, and employer action steps. Access the webinar replay here Identity Theft Is Still the Top UI Fraud Threat In our UI Fraud webinar, Experian experts confirmed that identity theft remains the #1 type of unemployment insurance fraud, especially in remote and hybrid workforce models. Claims filed under the names of active employees or fake identities can go undetected—until the employer gets hit with the tax consequences. Two common types include: Stolen Identity Claims: Fraudsters file under real employee names using stolen credentials. Claim Hijacking: A legitimate claimant’s benefits are redirected after their account is accessed fraudulently. Employers must act quickly when fraud is suspected—report it to the state and advise employees to monitor or freeze credit. New Wave: Fake Employers, Bigger Payouts In addition to fraudulent claims, state agencies are now targeting fictitious employers—shell companies created to submit fake wage reports and collect benefits for non-existent employees. These schemes are more sophisticated and harder to catch without employer cooperation during wage audits. The Cost of Fraud: You Pay the Price UI fraud doesn’t just harm state trust funds—it directly impacts employers through: Increased unemployment tax rates Audit triggers Delays in legitimate claims Reputational damage in state systems Even though only 1.3% of overpayments are caused by employers, late or incorrect responses can have costly consequences. Shutdowns and Enforcement: Compliance Doesn’t Sleep While the federal government endured a record-breaking shutdown in late 2025, enforcement didn’t stop. In fact: ICE and DHS continued audits and E-Verify processing IRS deadlines remained in effect States expanded wage theft and unemployment laws The message is clear: compliance responsibilities remain active, even during federal disruptions. State Law Spotlight: Wage Theft, AI, and UI Expansion Employers must also prepare for new state laws, including: Rhode Island: New-hire wage theft notice requirements starting 2026 Illinois: AI restrictions in hiring if discrimination is detected Washington & Oregon: New UI benefits for striking workers, increasing trust fund pressure And these changes aren’t outliers—over 1,000 AI-related bills were introduced nationwide in 2025, with paid leave and wage transparency laws also gaining traction. Preventing Fraud Is a Team Effort: What You Can Do Experian recommends a multi-pronged approach: Respond quickly to all UI claims Audit payroll, separation processes, and seasonal hiring protocols Watch for claims from current employees or unknown names Report suspicious activity to state agencies Verify employee identity before completing I-9s Educate teams to recognize and flag red flags And most importantly—implement or strengthen your internal I-9 audit process. A reliable electronic I-9 system with audit trails, E-Verify integration, and correction workflows is essential in today’s enforcement environment. Regulatory Look Ahead: I-9, WOTC, and Tax Compliance In tandem with fraud risk, 2025 delivered high-impact policy changes, including: Elimination of auto-extensions for EADs, increasing document expiration risks A new W-4 and W-2 draft for 2026, requiring updated payroll processes and tip tracking under the One Big Beautiful Act (OBBA) A pending decision on WOTC renewal, which expired 12/31/25. No bill has passed, but retroactive approval is likely—employers should continue capturing WOTC data. Unemployment trust funds also remain underfunded in most states, which may lead to taxable wage base increases and higher FUTA taxes in 2026 and beyond. Final Takeaways: Your 2026 Fraud & Compliance Readiness Checklist Begin or expand internal I-9 and UI auditsUse electronic I-9 platforms with real-time E-VerifyTrack WOTC applicants even if renewal is delayedTrain staff to spot identity and payroll fraudMonitor state laws affecting payroll, hiring, and separationReview IRS changes to W-4 and W-2 ahead of 2026 Get prepared now—not after you’ve been hit with an audit or fraudulent claim. Watch our webinar replay to hear directly from compliance and unemployment experts. For ongoing insights, tools, and thought leadership, visit the Experian Employer Services Blog.

An E-Verify data disposal alert means there are important steps employers should take before January 4, 2026 to stay compliant.

I-9 compliance faced a seismic shift last year. With new federal enforcement efforts, AI-driven audits, and increased scrutiny from ICE and USCIS, HR professionals must adopt smarter, faster, and more consistent practices to avoid fines and protect their workforce. This blog highlights key takeaways from Experian Employer Services’ recent I-9 compliance webinar and offers actionable insights to prepare your team for what lies ahead. I-9 compliance isn’t just about checking boxes anymore—it’s about protecting your business from legal, financial, and reputational risk. In this webinar, “I-9 Updates: Compliance, Audits & Enforcement,” I-9 experts André Gorash and Vijay Thakkar pulled back the curtain on this high-stakes topic. With over a decade of combined experience, André and Vijay highlighted major regulatory updates, shared real audit cases, and offered best practices for staying compliant in the face of growing enforcement and technological oversight. Want a deeper dive? Watch the full on-demand webinar “2025 I-9 Updates: Compliance, Audits & Enforcement” to get expert insights, real-world case studies, and practical tools your HR and compliance teams can use right away. Whether you're managing seasonal hires or navigating an internal audit, this session arms you with the knowledge to stay ahead of regulatory changes. Access the webinar replay here. AI + Audits = Zero Margin for Error The federal government is now leveraging a powerful AI system called RAVEN (Repository of Analytics in Virtualized Environment) to analyze I-9s, payroll records, audit trails, and more. This system uses OCR and machine learning to detect even minor I-9 errors—turning small clerical oversights into audit triggers. ICE’s enforcement arm is also growing, with the number of agents expected to increase from 6,000 to 16,000 by 2029. Surprise audits and site visits are becoming more frequent, especially in industries like hospitality, healthcare, agriculture, retail, and manufacturing. The Real Cost of I-9 Mistakes Recent enforcement actions have resulted in multimillion-dollar penalties. For example, three janitorial service companies in Denver were fined over $8 million combined. One company received a $6 million fine for knowingly employing 87 unauthorized workers. Even companies without malicious intent—just missing reverification deadlines—were heavily penalized. Civil fines range from $288 to $28,000 per violation, and errors related to employment authorization can escalate rapidly. Compliance Hot Spots in 2025 Several updates are catching employers off guard: DACA (C33) renewals are reopening. Be prepared to see more employees presenting valid work authorization under this category. TPS expirations for Syria and South Sudan mean affected employees must provide alternative documentation by early 2026. FNU/LNU IDs (First/Last Name Unknown) do not always indicate fraud and can result from cultural or processing inconsistencies. Handle these with care and awareness. Seasonal Hiring Pitfalls Seasonal employees hired for less than three business days must complete both Section 1 and Section 2 of the I-9 on their first day—the typical three-day grace period does not apply. Employers must also close out TNCs in E-Verify if the employee leaves before the issue is resolved. Rehiring someone? While it’s legally acceptable to reuse their original I-9 via Supplement B, best practice is to complete a new I-9 every time. This ensures you're aware of any status changes or revoked EADs that may have occurred since their last hire. Internal Audits: Don’t Wait for ICE Internal I-9 audits are the most effective defense against penalties. Start by gathering all I-9s for current and recently terminated employees. Review them using the USCIS M-274 Handbook, verify you're using the correct form version, and document all corrections with detailed memos to show good faith efforts. Important tips: Apply the same I-9 procedures across all job levels to avoid discrimination. Prepare for federal scrutiny before you receive a Notice of Inspection. Maintain a clean, auditable trail using a centralized electronic system. Choosing the Right I-9 System When evaluating an electronic I-9 solution, look for: Compliance features and automation Intuitive user experience Real-time alerts and reporting Auditability and fast record access Seamless E-Verify integration Scalability for future growth Dedicated support for policy updates An electronic system reduces human error and enforces consistent workflows—especially critical for distributed or seasonal teams. Key Takeaways AI is driving new enforcement. The RAVEN system ensures even minor mistakes are found. Fines are real—and rising. Noncompliance penalties can exceed $28,000 per violation. Seasonal and rehires require special care. Always verify documentation properly and complete new I-9s when needed. Consistency matters. Apply your I-9 process equally to all staff, from executives to hourly workers. Electronic systems simplify compliance. Invest in tools that reduce risk and provide audit-ready documentation. Start internal audits now. Don’t wait for an official request to uncover compliance gaps. For more tools and thought leadership on workforce compliance, visit the Experian Employer Services Blog.

On December 31, 2025, U.S. District Judge Trina Thompson issued a significant nationwide injunction, voiding the Department of Homeland Security’s (DHS) previous decision to terminate Temporary Protected Status (TPS) for approximately 60,000 to 89,000 nationals from Honduras, Nepal, and Nicaragua. For employers, this means immediate changes to how Employment Authorization Documents (EADs) for these employees must be handled during the Form I-9 process. Current Status and Employer Requirements (2026) As of January 1, 2026, the following legal protections are in place:  TPS status and work authorizations for eligible nationals from Honduras, Nepal, and Nicaragua are fully reinstated. Employers are legally required to honor the Employment Authorization Documents (EADs) of affected TPS holders. Even if a card appears expired on its face, it may be subject to an automatic extension by operation of this court order. Federal officials and employers are barred from taking adverse actions, such as termination or detention based solely on the previously announced (and now voided) termination dates for these specific countries. What This Means for Form I-9 Compliance? Employers should review their active Form I-9 files for employees who previously presented TPS-based EADs from these three countries. Do Not Terminate: If an employee's work authorization was set to expire due to the now-voided DHS termination, they remain authorized to work. Monitor for USCIS Guidance: We expect USCIS to publish a formal Federal Register notice shortly providing specific instructions on "Additional Information" notations for Section 2 of the Form I-9. Note that the government may appeal this decision to the Ninth Circuit. However, the injunction remains in effect nationwide until further notice. Note: For specific EAD auto-extension dates and official documentation to keep with your I-9 records, please refer to the USCIS Temporary Protected Status page.

It's officially a new year, but that doesn't mean 2025 ended without some lingering effects. Employers face an evolving regulatory environment shaped by immigration reform, AI legislation, unemployment tax adjustments, and the uncertain fate of key programs like the Work Opportunity Tax Credit (WOTC). In this blog post, we distill the most important takeaways from Experian Employer Services’ latest quarterly webinar, covering what HR, tax, and compliance teams need to know now to prepare for the rest of 2026. While Congress has been historically inactive in 2025—passing only 36 bills—the federal regulatory machine never stopped. In Experian Employer Services’ November webinar, “Quarterly Regulatory & Legislative Updates for Employers (Q4),” experts Gordon Middleton and Wayne Rottger broke down the compliance shifts that will shape the road ahead. Missed the live event? You can access the on-demand recording of Quarterly Regulatory & Legislative Updates (Q4) to hear directly from our compliance experts. This 60-minute session offers in-depth coverage of urgent topics including IRS withholding changes, state unemployment tax trends, and federal immigration enforcement. Watch now. Congressional Inactivity Doesn’t Mean Employer Invisibility Although Congress passed fewer bills than any time in modern history, executive action and federal agencies filled the gap. The president issued over 210 executive orders in 2025, and federal agencies like USCIS and DHS continued rapid-fire regulatory activity. Among the biggest changes: H-1B Visa Petitions: A controversial $100,000 petition fee for some H-1B applications was introduced in September and clarified in October. This policy is being challenged by the U.S. Chamber of Commerce and others. EAD Auto Extensions: Effective October 30, 2025, DHS eliminated auto extensions for many Employment Authorization Document (EAD) categories—including asylum applicants, TPS holders, and refugees. E-Verify Enforcement: E-Verify operations remained active through the government shutdown, a signal that immigration vetting remains a priority. Employers were reminded to submit cases timely and document any delays. One Big Beautiful Bill Act (OBBBA): Big Withholding Changes Ahead The OBBBA continues to reshape how payroll and HR teams handle tipped employees: Tip Tracking: Employers must now identify “qualified tips” tied to specific occupations using Treasury-issued codes (nearly 70 new codes were released). 2026 W-2 Draft Changes: A new Box 14B will be introduced for these occupation codes, and Box 12 will include new reporting fields. Also expect a 15-line worksheet on the 2026 W-4 draft, which expands deductions. Employer Limitation: Employers can’t force employees to adopt the new W-4, so communication strategies must be prepared in advance. Shutdowns and Backlogs: IRS and SSA Still Expect Timely Compliance Despite mass furloughs at the IRS and other federal agencies, deadlines remain intact. Automated notices are still being sent, payments are due, and limited live support is available. SSA, DHS, and ICE continued operating at high capacity during the shutdown. State-Level Legislation: The Real Compliance Movers States continued to pass meaningful reforms while the federal government stalled. Highlights include: AI Restrictions: Illinois now prohibits AI in hiring if it leads to discriminatory outcomes. Wage Theft Notices: Rhode Island’s new hire notice requirement starts January 1, 2026. Pay Transparency: Massachusetts will require employers with 25+ employees to publish pay ranges starting October 2026. Paid Leave Expansions: Nebraska mandated new minimums for employers with as few as 11 employees. Unemployment Legislation: A Rising Risk for Employers 2025 saw 188 unemployment-related bills, with many focusing on expanding access to benefits—even to striking workers. Washington and Oregon passed laws granting UI benefits during trade disputes, raising red flags about future trust fund stability. Key takeaways: Trust Fund Risk: Most state UI trust funds are underfunded. Large-scale strikes could significantly drain them. FUTA Credit Reduction: California and the U.S. Virgin Islands are likely to face FUTA reductions in 2026. California alone owes $21 billion in federal UI loans. Taxable Wage Base Increases: Half of U.S. states are increasing UI taxable wage bases in 2026, affecting employer payroll budgets. WOTC Renewal: Hopeful, But Not Done Yet The Work Opportunity Tax Credit (WOTC) expired December 31, 2025. Although it has historically been renewed retroactively, no bill has yet been introduced. Industry advocates report promising signs, but employers are advised to continue processing applications to remain retroactively compliant if renewal occurs. Final Key Takeaways Compliance Doesn’t Pause—even during a shutdown. Deadlines remain active. Prepare for OBBA Impact—new W-4 and W-2 formats will require payroll system updates. State Legislation Will Continue—watch for wage theft, pay transparency, and AI usage laws. UI Tax Changes Are Coming—plan for higher taxable wage bases and future trust fund pressures. WOTC Renewal Uncertain—continue screening and tracking candidates until further notice. Use a Trusted Compliance Partner—keeping up with regulatory changes is more than a full-time job. Stay informed year-round with the Experian Employer Services Blog. Subscribe for updates on legislative changes, compliance tools, and insights from our subject matter experts.

The IRS has officially released the final 2026 Form W-4, Employee’s Withholding Certificate, incorporating updates from the One Big Beautiful Bill Act (OBBBA). Following the August draft, the finalized form confirms structural and numeric changes designed to align withholding with new deduction and credit provisions under the OBBBA. The finalized form expands the Deductions Worksheet, clarifies exemption procedures, and adjusts credit values to reflect the updated Child Tax Credit of $2,200 per qualifying child, up from $2,000. The layout now totals five pages (including instructions), up from four in 2025. Key 2026 updates: Step 3: Claim Dependent and Other Credits Split structure retained: Lines 3(a) and 3(b) remain separate for qualifying children and other dependents. New value applied: The Child Tax Credit rises to $2,200 per child under OBBBA, while the $500 credit for other dependents is unchanged. Step 4: Other Adjustments The optional label has been removed. Step 4 now clearly defines its subsections. Step 4(b) explicitly states that if left blank, withholding defaults to the standard deduction. Exemption checkbox added: Employees can now claim exempt from withholding via a formal checkbox and certification, replacing the old handwritten “Exempt” notation. Expanded Deductions Worksheet (Page 4) The worksheet grows, occupying its own page, and now includes new categories introduced by OBBBA: Qualified tips. If your total income is less than $150,000 ($300,000 if married filing jointly), enter an estimate of your qualified tips up to $25,000 Qualified overtime compensation: If your total income is less than $150,000 ($300,000 if married filing jointly), enter an estimate of your qualified overtime compensation up to $12,500 ($25,000 if married filing jointly) of the “and-a-half” portion of time-and-a-half compensation. Qualified overtime compensation. If your total income is less than $150,000 ($300,000 if married filing jointly), enter an estimate of your qualified overtime compensation up to $12,500 ($25,000 if married filing jointly) of the “and-a-half” portion of time-and-a-half compensation. Qualified passenger vehicle loan interest. If your total income is less than $100,000 ($200,000 if married filing jointly), enter an estimate of your qualified passenger vehicle loan interest up to $10,000. The worksheet retains traditional itemized categories (medical/dental, SALT, mortgage interest, charitable gifts) but now concludes with a limitation section and a refreshed standard deduction table. These additions directly mirror OBBBA’s new income-based deductions. Why this matters: The 2026 Form W-4 signals a shift toward greater precision and legislative alignment. Employees with variable pay—especially tips, overtime, or new car loans—can now fine-tune withholding through targeted deduction lines. Employers gain clearer data inputs for payroll accuracy and reduced rework. The checkbox for exemption simplifies verification and year-end tracking. The child credit increase ensures calculations match the higher benefit created under OBBBA. Employer checklist: Update HRIS/payroll fields to accommodate the expanded Step 4(b) deductions and new exempt checkbox. Refresh employee guidance—including onboarding instructions, FAQ content, and self-service portals—to explain the new lines. Validate withholding logic against 2026 tax tables once released. Communicate early—especially to employees with tips, overtime, or auto-loan interest deductions. Employees, what to know: If you earn tips or overtime, bought a new car, or are 65 or older, you may qualify for new deductions under OBBBA. Use the updated worksheet to reflect these items and avoid over withholding. The IRS withholding estimator (https://www.irs.gov/individuals/tax-withholding-estimator) remains the best way to validate accuracy throughout the year. Key takeaway: The final 2026 Form W-4 transforms the withholding certificate into a more granular, data-driven tool. It brings OBBBA’s deductions and credit changes directly into payroll operations and requires employers to review system fields and training materials now to stay ahead of 2026 implementation.

Having spent decades working with unemployment programs across the country—from state agencies to employer groups to TPAs—I’ve seen many changes in how states administer unemployment claims. Some changes feel routine. Others signal a shift toward modernization. New Jersey’s recent passage of S.2357 falls into the second category. The law is designed to improve communication between employers and the New Jersey Department of Labor (NJDOL) by ensuring the state receives separation details sooner and more consistently. Recently, the Association of Unemployment Tax Organizations (AUTO) asked NJDOL to clarify several operational questions. The department’s written responses finally give employers a clearer picture of what to expect as the state moves forward with implementation. Below is a practical, easy-to-digest summary of what New Jersey employers should know. 1. The Heart of S.2357: Two Options for Employers NJDOL has confirmed that employers have two ways to meet the new requirement. Employers do not have to do both—just one. You must either: Option 1 — Respond to the UI claim notice within 7 days, or Option 2 — Provide the separation information in the employer portal within 7 days of separation. Either option satisfies the requirement on its own. Submitting the separation information at the time of separation is preferred because it gives the agency a head start and often leads to quicker, more accurate determinations. However, NJDOL emphasized that this is not mandatory.  If an employer simply responds to the initial claim notice within the 7-day timeframe, the requirement is considered met. This clarification should bring relief to many employers who feared the law imposed two separate, and potentially duplicative, steps. 2. About That $500 Penalty… You may have heard S.2357 includes a $500 penalty for failing to provide separation information. Here’s what NJDOL shared: The penalty remains part of the statute. NJDOL is not enforcing it at this time. The agency wants to give employers time to adjust to the new system. Enforcement could begin at a later date once the system is fully operational. In short, the penalty exists, but employers should focus on learning the process rather than worrying about fines right now. 3. Employer Access (EA) Portal Registration: The First Step To participate in the new reporting process, employers must activate their Employer Access (EA) account within the MyNewJersey system. NJDOL clarified the following: Employers need a unique authorization code to register. These codes were mailed to employers in July 2024. A follow-up statewide mailing is planned for January 2026 for employers who didn’t receive or misplaced their code. Employers must register before a TPA can link to their account. After the employer registers, the TPA can request access using the employer’s EIN and authorization code. The employer then approves (or denies) the request via email. Registration is truly the gateway to everything else. Without it, employers and TPAs cannot begin using the new separation reporting system. 4. Submitting Separation Details Early: How NJDOL Uses the Data Many employers asked how the state will handle separation information submitted before a former employee files a UI claim. NJDOL shared the following helpful process: Early separation details will be stored in the system but not acted upon immediately. The system will crossmatch this information daily against new UI claims. When a match occurs, the claimant will receive a fact-finding questionnaire that includes the employer’s earlier statement. If the employee never files for benefits, nothing is sent to the individual—and the information simply remains on record. This optional early submission can improve accuracy and reduce back-and-forth between employers, claimants, and the agency. 5. Practical Advice Moving Forward Based on NJDOL's responses, here’s what I would advise employers right now: Register your EA account as soon as you have your authorization code—this unlocks everything. Choose the approach that best fits your workflow: respond to the claim within 7 days OR post the separation at the time of separation. Don’t stress about penalties right now but do build good habits early. Stay in communication with your TPA so responsibilities are clear and aligned. Expect further refinement, as with any modernization effort, changes may continue as the system evolves. New Jersey’s intent is not to burden employers but to create a more consistent and efficient UI process. With clear expectations and the ability to choose the method that works best for your organization, compliance should feel manageable—not overwhelming. Experian Employer Services will continue to provide updates and best practices as available.

Haiti’s TPS designation and related benefits will terminate on Feb. 3, 2026, at 11:59 p.m. Completing Form I-9 Form I-766, Employment Authorization Documents (EADs) with a category A12 or C19 and an original “Card Expires” date of Feb. 3, 2026; Sept. 2, 2025; Aug. 3, 2025; Aug. 3, 2024; June 30, 2024; Feb. 3, 2023; Dec. 31, 2022; Oct. 4, 2021; Jan. 4, 2021; Jan. 2, 2020; July 22, 2019; Jan. 22, 2018; or July 22, 2017, will expire Feb. 3, 2026. Employers must reverify TPS Haiti beneficiaries who presented these EADs before they start work on Feb. 4, 2026. Recommended Employer Actions Reverify Form I-9: Employers must reverify employment authorization for Haiti TPS holders before the termination date. Use Supplement B and request updated documentation from affected employees. Monitor E-Verify Alerts: Stay alert for notifications regarding expiring or revoked Employment Authorization Documents (EADs). Avoid Discrimination: Ensure compliance with anti-discrimination provisions when requesting documentation. Employers should prepare for potential workforce impacts and communicate clearly with affected employees. For further guidance, consult DHS and USCIS resources or legal counsel.