Running a payroll in Gusto is a fairly simple process. It allows users to make detailed modifications that require in-depth knowledge of its features. In this guide, we will help you master the platform in simple and clear steps by covering the following: 

  1. Initial setup
  2. Running payroll in Gusto
  3. Paying employees via check
  4. Skipping employees from payroll
  5. Running an off-cycle payroll
  6. Customizing the spreadsheet
  7. Avoiding extra charges and penalties

Initial Payroll Setup

Before you run your first payroll, you’ll have to take care of these things for the initial setup. You can move to the next section if you have already covered all of this.

Business Documentation 

An Employer Identification Number (EIN), also known as an Employer Tax ID, is required for reporting taxes and payroll details to the Internal Revenue Service (IRS). Business owners can easily apply for an EIN online here. 

Depending on your state, you may also require a business ID. To check if it applies to your business, contact local officials or business regulatory authority for guidance.

Employee Documentation 

When filing taxes on behalf of your employees, you’ll need some basic information. This includes: 

  • Name
  • Employment period
  • Tax filing number
  • Address
  • Salary details
  • Form I-9
  • W-4 form for employees
  • W-9 form for contractors
Pro Tip
IMPORTANT: Remember to properly classify your employees into categories such as full-time, part-time, and contractors. Failure to do so may result in fines and penalties.

After gathering all the required information, log in to your Gusto account, and access the main dashboard. Look for ‘Get Started’ option and select it to fill in all the necessary details.

Running Payroll In Gusto

Once you are done with the initial setup, you can use the following steps to run the payroll: 

Navigate To The Payroll Section 

  • Sign in to your Gusto account
  • Select ‘Pay’ under the ‘Home’ tab on the left panel
  • Choose ‘Payroll’ option to access the next screen with the payroll spreadsheet

The payroll’s default layout is ‘Spreadsheet’, but you can toggle it to the ‘Legacy’ layout by using a button in the upper right corner.

Select The Pay Schedule 

Determine the pay schedule for your payroll by: 

  • Selecting ‘Pay Schedule’
  • Click on the ‘Add Pay Schedule’
  • Fill in the details and press the ‘Save’ button once you are done

Adjust Columns 

  • There are multiple columns in the spreadsheet, starting with the employees' names, total pay, rates, regular hours, bonuses, and so on
  • Reposition the columns by simply dragging them with the cursor, if needed
  • You can delete unwanted columns by clicking the ‘Column’ button that sits right on top of the spreadsheet and then unchecking those that you don’t need

Import Payroll Data 

If your company already uses software or a process to keep track of employee data, you can conveniently transfer it to Gusto. To do it: 

  • Click on the ‘Import payroll data’ option
  • Then, upload or drag a file with the supported format
  • Click ‘Upload and continue’ button

With this, the data will automatically be filled in on the main payroll spreadsheet. You can also manually adjust bonuses, paid time offs (PTOs), payment types, and more by simply clicking the boxes in front of individual employees and editing them. To apply changes to multiple employees at once, check the boxes on the left side of employee’s names. To select all the employees, click the ‘Select all’ button on the top before performing an action.

Review The Payroll 

After filling out every required detail, head on to review your payroll before the final submission. You can do that by following these steps: 

  • Navigate to the ‘Review Summary’ button at the bottom right corner and click on it
  • On the next screen, thoroughly check the payroll summary and withdrawal amount
  • Click on the dropdowns to get detailed insights on payroll elements such as wages and taxes
Pro Tip
IMPORTANT: Always double-check the values while reviewing the payroll and ensure that you have the required bank balance. Failed payroll attempts due to insufficient funds could result in additional charges, fines, and even restrictions.

Paying Employees Via Check

Select the employees that you are going to pay via checks. Then, choose the preferred printing format. For this, the software offers two options: 

  • Gusto checks
  • Blank checks

With blank checks, enter the desired number you want the checks to start from. Once selected, click on ‘See printable checks’. This will download the checks, which will allow you to print it. 

Skipping Employees From Payroll 

Managers can skip or remove employees from payroll. ‘Skipping’ will exclude them from the current payroll, while ‘Removing’ them will completely take them off the payroll sheet. Skipped payrolls cannot be undone, and if you decide to pay a skipped employee, you’ll have to run an off-cycle payroll. 

How To Skip An Employee 

Once you are on the spreadsheet, follow the steps below to remove an employee from the payroll: 

  • First, select the employee by clicking the checkbox next to the specific employee
  • Go to the ‘Actions’ column
  • Click on the three dots and select ‘Skip Payroll’ option
  • Now, run the payroll as usual and the skipped employee won’t be paid in this cycle

How To Skip Multiple Employees 

Again, access the spreadsheet and perform the following actions: 

  • Click multiple checkboxes on the left of employee's names to exclude them from the current payroll
  • Again, go to the ‘Actions’ bar
  • Click on the three dots located at the top of the column and choose ‘Skip Payroll’ option
  • Select ‘Yes, Skip Payroll’ if the confirmation box appears

The skipped employees won’t be included in the ongoing payroll 

Running An Off-Cycle Payroll

Admins can run an off-cycle payroll using the following steps: 

  • Select the ‘Pay’ section and then access ‘Run Payroll’ option from the left side bar
  • There, choose the ‘Off-Cycle Payroll’ option under the ‘Other Payroll Options’
  • Select the employee by clicking the checkbox
  • Define the period of pay (It’s the timeframe the employee worked for)
  • Enter the date you want the employee to be paid
  • Fill in other details like gross earnings and hours worked
  • Select the desired payment method, direct debit or check
  • Save and continue
  • Now, review the details carefully and submit the payroll

What Time Does Gusto Pay?

Gusto offers two payroll options: 2-day direct deposits and next-day direct deposits. Let’s break these down below. 

2-Day Direct Deposit 

Administrators will have to run the payroll two days before the actual date they want the salaries to be deposited.

Next-Day Direct Deposit 

Next-day direct deposit is a quicker transaction. It allows employers to run the payroll by 5 pm local time and have the funds transferred the next day.