Disclaimer
notwithstanding discrimination laws, employers may always hire the best-qualified candidate for the job
the important thing is to be able to explain how the one who was hired really had the best qualifications
that, of course, requires a very close and careful look at the job applications and other information about applicants and a meticulous consideration of all factors that are relevant to the job
in general, employers do not have to explain why they are not hiring a particular applicant (exception: applicants turned down due to an adverse background or credit check covered by the FCRA - see the discussion on the FCRA in the topic "References and Background Checks" for more details)
it is usually best to restrict any explanations to short and factual, non-inflammatory statements such as "you seem to have some good qualifications. However, the one we hired better fit the requirements we had at this time. Please check back with us about any openings we might have in the future. Thank you."
try to avoid ever using the term "overqualified" to explain why a person is not suitable for hire - the EEOC and the TWC Civil Rights Division consider that to be potential evidence of age discrimination