I-9 Audits and Employer Compliance in 2026: What Texas Businesses Must Do Now
The enforcement landscape for employers in 2026 is more aggressive than at any point in the past two decades. The Department of Homeland Security has conducted more than 605,000 deportations, worksite enforcement operations have expanded dramatically, and Immigration and Customs Enforcement (ICE) has signaled that I-9 audits of businesses employing foreign workers are a top priority. For Texas employers — particularly those in industries that rely on H-2B seasonal workers, TN professionals, H-1B specialists, and other authorized foreign nationals — immigration compliance is no longer a background concern. It is a front-line business risk.
This guide covers what Texas employers need to know about I-9 compliance, E-Verify requirements, how to prepare for an audit, and the penalties for violations in 2026.
What Is the I-9 and Why Does It Matter?
Form I-9 (Employment Eligibility Verification) is required for every employee hired in the United States, regardless of citizenship or immigration status. The form verifies the employee’s identity and authorization to work. Both the employee and the employer have specific obligations: the employee must present acceptable documents establishing identity and work authorization, and the employer must examine those documents, complete the employer section of the I-9, and retain the form for the required period.
I-9 violations — even paperwork errors with no intent to hire unauthorized workers — can result in substantial civil penalties. In 2026, the penalty ranges are $281 to $2,789 per I-9 for paperwork violations (technical errors) and $698 to $27,894 per unauthorized worker for knowingly hiring or continuing to employ unauthorized individuals.
Current Enforcement Climate in Texas
Texas is a focal point for worksite enforcement. ICE’s Homeland Security Investigations (HSI) unit has increased I-9 audit activity across the state, with particular attention to industries known for employing foreign workers: agriculture, construction, hospitality, food processing, landscaping, and oil and gas services. San Antonio, as one of the largest metropolitan areas in Texas with a significant foreign-born workforce, is a priority area for enforcement.
In addition to I-9 audits, ICE has conducted high-profile worksite raids and criminal prosecutions of employers found to be knowingly employing unauthorized workers. The message is clear: employers who cut corners on immigration compliance face real consequences — not just fines, but criminal charges, business closures, and reputational damage.
I-9 Compliance Checklist for Texas Employers
Completing the I-9 Correctly
Section 1 (Employee): Must be completed by the employee no later than the first day of employment. The employee provides their name, address, date of birth, citizenship or immigration status, and (if applicable) Alien Registration Number or I-94 number. The employee signs under penalty of perjury.
Section 2 (Employer): Must be completed by the employer within three business days of the employee’s first day of work. The employer examines original documents from the employee that establish both identity and work authorization. The employer records the document information in Section 2 and signs the certification.
Section 3 (Reverification and Rehires): Used when an employee’s work authorization expires and they present new or renewed documentation, or when a former employee is rehired within three years of the original I-9 date.
Acceptable Documents
The I-9 instructions list three categories of acceptable documents. List A documents establish both identity and work authorization (examples: U.S. passport, permanent resident card, Employment Authorization Document). List B documents establish identity only (driver’s license, state ID), and List C documents establish work authorization only (Social Security card, birth certificate). Employees may present one List A document, or one List B document plus one List C document.
Critical rule: The employer cannot specify which documents the employee must present. You cannot demand a green card or a specific type of ID. Requiring specific documents based on the employee’s perceived national origin or citizenship status is document abuse — a violation of anti-discrimination provisions that carries separate penalties.
Retention Requirements
I-9 forms must be retained for either three years from the date of hire or one year after the date employment ends, whichever is later. Do not destroy I-9 forms too early, and do not retain them longer than required — both errors create compliance issues during audits.
E-Verify in Texas
E-Verify is an electronic system that compares information from the I-9 form against DHS and Social Security Administration databases. While federal law does not require all employers to use E-Verify, Texas enacted Senate Bill 1 in 2023, which requires state agencies and political subdivisions to use E-Verify for new hires. Federal contractors and subcontractors are also required to use E-Verify.
Even for employers not legally required to use E-Verify, voluntary enrollment can provide an additional layer of compliance protection. However, E-Verify is not a substitute for properly completing the I-9 — it supplements the I-9 process but does not replace it.
How an I-9 Audit Works
Notice of Inspection
An I-9 audit typically begins when ICE serves a Notice of Inspection (NOI) on the employer, giving at least three business days to produce I-9 forms for inspection. The NOI may be served in person, by mail, or by email. The employer must produce I-9 forms for all current employees and for any former employees whose I-9s are still within the retention period.
Audit Review
ICE auditors review each I-9 for completeness, accuracy, and compliance. They cross-reference employee information against government databases. Common findings include missing or incomplete I-9 forms, missing employee signatures, incorrect or missing document information in Section 2, expired documents that were not reverified, I-9 forms not timely completed (more than 3 business days after hire), and unauthorized workers identified through database checks.
Possible Outcomes
After the audit, ICE may issue a compliance letter (no violations found), a warning notice (technical violations found but no fines assessed), a Notice of Intent to Fine (civil penalties for violations), or a Notice of Suspect Documents (potential unauthorized workers identified). Employers have the right to respond and negotiate before final penalties are assessed.
Preparing for an Audit Before One Arrives
Conduct an internal I-9 audit. Review every I-9 form currently on file. Identify and correct any technical errors — missing signatures, incomplete fields, incorrect dates. For minor corrections, make a single line through the incorrect information, write the correct information, and initial and date the correction. Do not use white-out or create new I-9 forms to replace problematic ones.
Establish a consistent I-9 process. Designate specific personnel responsible for I-9 completion. Create a checklist. Train managers and HR staff on acceptable documents, anti-discrimination rules, and timing requirements.
Use a centralized filing system. Store I-9 forms in a dedicated, organized system — separate from general personnel files. Many employers now use electronic I-9 systems that include audit trails and automatic reminders for reverification dates.
Reverify work authorization before it expires. When an employee’s work authorization has an expiration date, the employer must reverify by the expiration date. Set up calendar reminders 90 days before any employee’s work authorization expires. This is especially important for employees on Employment Authorization Documents (EADs), which now require closer tracking after the elimination of automatic extensions for many categories.
Know what NOT to do. Do not discriminate in document requests. Do not request more documents than required. Do not refuse to accept valid documents. Do not destroy I-9 forms in anticipation of an audit — this constitutes obstruction and carries criminal penalties.
Special Compliance Issues for Employers of Foreign Workers
Employers who sponsor workers on H-1B, TN, L-1, H-2B, or other work visas face additional compliance obligations beyond the I-9. These include maintaining a public access file for H-1B employees containing the LCA, prevailing wage documentation, and notice of filing, posting LCA notices at the worksite for H-1B employees, paying at least the prevailing wage at all times, not requiring employees to reimburse the employer for H-1B fees, and notifying USCIS if the employment relationship ends before the H-1B petition’s validity period expires (the employer must offer to pay return transportation costs).
Frequently Asked Questions
Can ICE show up at my business without warning?
ICE typically provides at least three business days’ notice before an I-9 audit. However, in criminal investigations involving suspected harboring or trafficking, ICE may execute a search warrant without advance notice.
What if I find an unauthorized worker during my internal audit?
If you discover through an internal audit that an employee’s work authorization has expired or that their documents cannot be verified, consult an immigration attorney immediately. Taking adverse action against an employee based solely on their national origin or citizenship status, rather than verified work authorization problems, can expose you to discrimination claims.
How much do I-9 fines cost?
Paperwork violations range from $281 to $2,789 per form. Knowingly hiring unauthorized workers ranges from $698 to $27,894 per worker. Penalties increase for repeat violations. Criminal penalties — including imprisonment — apply to pattern or practice violations.
Do I need to reverify U.S. citizens and permanent residents?
No. U.S. citizens and lawful permanent residents have permanent work authorization. You should never reverify employees who presented a U.S. passport, permanent resident card, or unrestricted Social Security card. Reverification only applies to employees who presented documents with expiration dates (such as EADs or temporary work visas).
Protect Your Business With Proactive Compliance
Attorney Alfredo Lozano is Board Certified in Immigration and Nationality Law by the Texas Board of Legal Specialization. The Lozano Law Firm’s business immigration practice helps Texas employers build compliant I-9 processes, prepare for audits, sponsor foreign workers, and navigate the complex intersection of employment law and immigration enforcement.
With offices in San Antonio, Eagle Pass, and San Angelo, the Lozano Law Firm serves employers across Texas. Schedule a consultation today to review your I-9 compliance and protect your business.
