What Is an I-9 Form?

Whenever a company hires a new employee in the United States, that employee must fill out Form I-9. In 1986, Ronald Reagan signed the Immigration Reform and Control Act, which outlined a company's responsibility to ensure its employees are legally eligible to work in the U.S. The I-9, Employment Eligibility Verification form, was created to prove an employee's work authorization to the federal government. Employers are required to file an I-9 for each new hire and keep it on record.

Both the new employee and the employer are responsible for filling out parts of the I-9 form. As the owner of a small business, you must be aware of your requirements for filing I-9 forms if you choose to hire employees. Keeping accurate I-9 forms will help your business stay in compliance with the U.S. Citizenship and Immigration Services (USCIS), an arm of the Department of Homeland Security (DHS).

All companies in the U.S. use I-9 forms to verify employee eligibility for people like resident citizens and noncitizen nationals. However, companies can't make prospective hires fill out a form until after a job offer has been made. This protects new workers from discrimination based on their immigration status. If an employer doesn't follow I-9 regulations, they can face harsh penalties from the DHS.

In this guide, we'll cover who uses Form I-9 and what you need to know about the I-9 when it comes to owning and operating a small business.

Who Uses an I-9 Form?

Every new hire has to fill out an I-9 form. After hiring a new employee, the employer has three days to certify the new worker's right to work and make sure everything on the I-9 form is correct. Workers who don't understand English can get help from an expert with a translator certification or legal document preparers to fill in their employee information.

While businesses making new hires are required to retain I-9 documents for their employees, some workers don't need to have I-9 forms. The Immigration Reform and Control Act doesn't work retroactively and only applies to business entities. For example, the act doesn't require employees hired before 1986 to fill out I-9s. Here are some other situations where workers won't need the document.

• Individuals hired on or before Nov. 27, 2009, who work in the Commonwealth of the Northern Mariana Islands
• Individuals who do domestic or casual work in a private residence, like cleaners or gardeners
• Self-employed individuals, like freelancers and independent contractors
• Anyone who doesn't physically work in the United States or a U.S. territory

Employers also don't have to issue I-9s if they hire temporary workers on a contract basis through a service like a temp agency. The government considers these workers employees of the agency, so the temp agency would be responsible for retaining their I-9 forms.

Documentation Needed to Verify Form I-9

To prove the employee's identity, they must have a few forms of identification to complete Form I-9. If the new hire doesn't have the required identification documents, the employer can't legally hire them.

Some examples of acceptable documents used to establish identity are listed below. Acceptable documents fall into three categories: A, B, and C. A new employee can present an employer one document from List A or a document from List B and a document from List C. These must all be currently valid and presented before their expiration date. These lists are featured on the I-9 form. Photocopies will not suffice, as all documents have to be the original documents.

List A

• U.S. passport card that must be unexpired
• Lawful permanent resident card (also known as a green card or alien registration receipt card) good for 10 years
• Temporary resident card good for two years
• Employment authorization document that lets immigrants work in the U.S. for one year
• Foreign passport with a temporary I-551 official seal

List B

• Driver's license issued by the state
• State identification card
• Native American tribal document
• School ID card with photo
• Voter registration card
• U.S. military card or draft record
• Military dependent's ID card
• School report card (if under 18 and unable to provide one of the documents above)
• Clinic, doctor, or hospital record (if under 18 and unable to provide one of the documents above)
• Day care or nursery school record (if under 18 and unable to provide one of the documents above)

List C

• Social Security card
• U.S. citizen ID card
• Original birth certificate or a certified copy of a birth certificate
• Certification of Birth Abroad document (Form FS-545)
• Consular Report of Birth Abroad document (Form FS-240)
• Form I-94 authorizing work with a specific employer

The employer fills out the second complete section of the I-9 form. In the Employer or Authorized Representative Review and Verification section, the employer certifies the employee's work status by recounting the submitted documents. This section must be completed within three days of the employee start date. A copy of the signed I-9 must be stored in the employer's records.

The federal government offers a way to verify I-9 information, like their Social Security number and hospital records, online using the E-Verify system. The site compares I-9 details against information from the U.S. Department of Homeland Security and Social Security Administration records.

How Do You File an I-9 Form?

Once an employee has filled out the I-9 form provided by their employer, the employer is required to store it in their filing system for at least three years. If someone works for you longer than that, you'll need to hold onto the form for a year after the date employment ends. Every employee who works for your company (except contract workers) needs to fill out an I-9 before their first day of employment, regardless of their resident citizenship status, immigrant or nonimmigrant.

Keep your employee files secure and confidential. If you have physical copies, you can keep them in a file cabinet with a lock or a safe. You can also keep electronic copies. If you go that route, you'll have to make sure the forms are secure. Be sure to make backups for electronic files and store them on the cloud or an external device, like a USB drive. Make sure everything is password-protected.

Unless an employee has a gap of over a year in their work history, I-9 forms are good forever. However, student exchange visitors and foreign aliens with work visas need to reverify their forms every time they get a visa extension. If their visa has expired, reverification will happen when they get a new employment authorization permit.

Technical Violations and How to Avoid Them

The DHS gives big penalties to businesses that don't file I-9 forms. If you intentionally hire workers who aren't authorized to work in the U.S., you can get a fine of over $20,000 for each unauthorized worker. There are also technical violations that can carry fines from $230 to $2,292 per issue. Below are some examples of technical errors you'll want to look out for.

• The employee forgets to date the form when they are hired.
• The form doesn't have a date for the beginning of employment.
• The employer section is not dated within three days of the employee's start date.
• There is no rehiring date for an employee who is being rehired.
• There is no date of birth or indication that an employee is younger than 18 years old.

Fortunately, if the DHS notices any of these errors on your employee's I-9 form, they'll give you a window of time to get it fixed. You'll have 10 business days to amend any errors before any fines are issued. Still, it's a smart practice to double-check your work when filling out any legal document.

Use Accounting Software to Keep Your Business Organized

There are a number of rules you have to follow and documents you have to keep track of when hiring new employees. Knowing how to handle I-9s and other employment forms will help you stay in compliance with federal law. As a small business owner, making sure I-9 forms are filled out correctly can be even more important. You don't have the budget to pay large fines from the DHS.

Remember that if you choose to hire contract workers, you won't need to worry about the I-9 process. Freelancers and independent contractors typically already have the skills to complete a project. They can save your company paperwork, money, and training time. Even so, you should have some understanding of how to complete and store I-9 forms if you ever decide to expand your business with full-time employees.

Because there's no handbook for employers starting a small business, it can seem like there's a never-ending list of things to do. Unless you love administration, it can be stressful to deal with mountains of paperwork. Skynova's accounting software can simplify things like invoicing, tracking expenses, and general accounting so that you can spend more time on growing your business.