This is where employers get into trouble.

If an employer:

❌ Hires someone without SSN
❌ Pays them through payroll
❌ Issues a W-2 using an ITIN

They are:

• Violating Form I-9 employment verification rules
• Potentially violating federal immigration law
• Exposed to:

💰 Fines can range from $676 to over $27,000 per unauthorized worker

🚨 The “1099 Trick” Is ALSO Dangerous

Many employers say:

“We’ll just pay them as an Independent Contractor using their ITIN.”

But if the worker:

• Has a fixed schedule
• Uses company tools
• Works under supervision
• Is economically dependent

👉 They are likely a common law employee

Misclassifying them as a contractor may trigger:

• Form SS-8 determination
• Payroll tax assessments
• Penalties under:
  • IRC §3509
  • Trust Fund Recovery Penalty