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Newbie Rules

Do you know your state's requirements for reporting new hires?

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This story appears in the August 2000 issue of Entrepreneur. Subscribe »

States are cracking down on deadbeat dads and fighting fraud in their unemployment and worker's compensation programs. Laudable goals, no doubt-but the end result means entrepreneurs will spend more time filling out paperwork on new hires.

The 1996 welfare reform law required all states to set up new-hire reporting programs. "Besides improving child-support enforcement, the hope is that states will cross-check their new-hire information with their own unemployment-compensation databases and catch people who are collecting benefits if they're working," says Elizabeth Pope, a senior writer and analyst at CCH Inc., a Riverwoods, Florida, company that provides software and information to HR, legal, accounting and small-business professionals. "[The welfare reform law] has the potential to help taxpayers."

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