The South Carolina Illegal Immigration and Reform Act requires all employers to verify the legal status of new employees, within three days of employment, and prohibits the employment of any worker who is not legally in this country and authorized to work. The South Carolina Department of Labor, Licensing and Regulation (SCLLR) is in charge of enforcing this law.

• Complete the Employment Eligibility Verification (Form I-9). The form is from the US Citizenship and Immigration Service.
• Verify the employee’s employment status through the E-Verify system.

E-Verify federal work authorization program administered by the U.S. Department of Homeland Security (USDHS) through Citizenship and Immigration Services (CIS). Complete and maintain the federal employment eligibility verification form, more commonly known as the Form I-9 for each employee.

• Learn more from the South Carolina Department of Labor, Licensing and Regulation.

The Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (Federal Welfare Reform) requires employers to report the following data elements to the Department of Social Services for each newly hired or rehired employee within 20 days:

• Employer Name
• Employer Address
• Employer Federal Identification Number
• Employer Phone Number (optional)
• Employee Name
• Employee Address
• Employee Social Security Number
• Employee Date of Birth
• Employee Date of Remuneration (first day of work)

New Hire information submitted by employers will only be used for purposes prescribed by law, including:

• Establish and enforce child support orders
• Detect Unemployment Benefits overpayments and fraud
• Detect Workers' Compensation overpayments and fraud
• Detect overpayments and fraud in other government programs, such as Welfare and Food Stamps

The penalty for an employer failing to report newly hired or rehired employees is:

• $25 for the second offense and $25 for each offense thereafter; or
• $500 for each and every offense, if the failure to report is the result of a conspiracy between the employer and the employee not to supply the required information or to supply false or incomplete information.

Report all new hires to the South Carolina Department of Social Services.  

Withholding is taken out of taxpayer wages to go toward the taxpayers' total yearly income tax liability. Every employer/withholding agent who has an employee earning wages in South Carolina (and who is required to file a return or deposit with the IRS) must make a return or deposit to the South Carolina Department of Revenue for any taxes that have been withheld for state purposes.

• If the employee is working in South Carolina, regardless of where he/she is a resident, the income earned in South Carolina is taxed by South Carolina.
• If a South Carolina resident is earning wages in a state that does not have a state income tax, the withholding should be for South Carolina.

Register for a withholding account with the South Carolina Department of Revenue.

• This application can be completed at the same time you complete the SCDOR’s Business Tax Application on MyDORWAY when you open your business or can be added to your account later if you're expanding your business by hiring employees.
• At the end of each year employers are required to upload W-2's and 1099's to the South Carolina Department of Revenue before January 31st of the following year. SCDOR has created a batch W-2 upload on MyDORWAY to make this process easier for employers. Learn more about the batch 1099 and W-2 upload program. 

Find more information about South Carolina Withholding. 

Federal Withholding- Learn more about federal withholding from the Internal Revenue Service.

Employers in South Carolina are required to register their employees using the state unemployment insurance tax system (SUITS). This program is administered by the South Carolina Department of Employment and Workforce (SCDEW). 

If the employer has at least one employee. SCDEW will determine the Unemployment Insurance liability or non-liability of the employing unit.

• Apply for an Employer ID number and learn more on the South Carolina Unemployment Insurance Tax System.
• File quarterly wage reports on behalf of your employee using the SUITS online portal. 

Your business may be liable for quarterly UI tax contributions if the business meets any one of the following criteria:

• Pays $1,500 or more in wages in any calendar quarter or has at least one employee during any 20 weeks in a calendar year.
• Acquires all or part of a business that was an employer subject to UI taxes at the time of the acquisition.
• Is liable under the Federal Unemployment Tax Act (FUTA) and has employees in South Carolina.
• Elects to become a liable employer.
• Pays cash wages of $1,000 or more in any calendar quarter for domestic services. Pays $20,000 or more to individuals employed in agricultural labor during any calendar quarter.
  • Employs 10 or more individuals in agricultural labor for a day in any 20 weeks in a calendar year. In certain situations, for-profit businesses may not be liable for UI taxes for certain individuals. Learn more about special situations where employers may not be liable for UI taxes from the South Carolina Department of Labor and Workforce.

According to the South Carolina Workers’ Compensation Commission (WCC), employers covered by the provisions of the State’s Workers’ Compensation Act are required to maintain insurance sufficient for the payment of compensation.

The rule of thumb is that any employer who regularly employs four or more workers full-time or part-time is required to have workers' compensation insurance. However, there are some exceptions to this.

• Learn more about what is required of an employer from the South Carolina Worker's Compensation Commission.

Employers in South Carolina are required to post two employment notices from the South Carolina Department of Labor, Licensing and Regulation in a place or places where employees can see them.

• FMLA, minimum wage, OSHA, etc. posters
• Discrimination posters
• ​Workers’ Compensation Compliance poster
• Federal regulations on wages, breaks, hours, etc

Learn more about the required employment posters from the South Carolina Department of Labor, Licensing and Regulation.

The Work Opportunity Tax Credit provides businesses a tax credit for hiring individuals with barriers to employment. The program enables targeted employees to move from economic dependency into self-sufficiency as they earn a steady income and become contributing taxpayers. Participating businesses are compensated by receiving a reduction in their federal income tax liability as a result of the tax credit. Maximum tax credits range from $2,400 to $9,600, depending upon the qualified employee’s targeted group.

If you are a business owner, you could benefit from tax credits by hiring within the following groups:

• Temporary Assistance for Needy Families (TANF) recipient
• Supplemental Nutrition Assistance Program (SNAP) recipient
• Empowerment Zone resident
• Marlboro County Rural Renewal Community resident
• Vocational Rehabilitation or Ticket-to-Work Participant
• Recently released ex-felon
• Supplemental Security Income (SSI) recipient
• Disabled veteran who within the last year was discharged or unemployed for 6 or more months
• Unemployed veteran
• Veteran receiving SNAP
• Long term unemployment recipient

This federally funded program is administered by the South Carolina Department of Employment and Workforce (SCDEW). SCDEW must certify the Work Opportunity Tax Credits before employers can claim them on their federal tax return. Requests must be postmarked within 28 days of the employee’s start date. Only those requests indicating potential target group eligibility should be mailed in/submitted.

Learn more about the Work Opportunity Tax Credit from the South Carolina Department of Employment and Workforce.