Question on payroll software (Gusto) extraction of Payroll from business account - advice needed on how to do P&L

[nick83]

My Payroll (Gusto) will create 2 line items on my bank:

• 1 for the Direct deposits of Payroll wages. Fine.
• 1 for the Taxes. (where i have issue)

The issue with the taxes line is that it INCLUDES both the Employee taxes and the company taxes. (1 extract for what seems like it should be 2.

But I certainly cant deduct "employee taxes" from my own Business Profit and Loss statement right?

So this seemingly requires me to have make a manual adjustment for for every month to my accounting software where i must reduce the line item by the employee taxes.

GIven how tedious this is I am wondering if this is a gusto thing or I am doing it wrong.

Side note: I have the EXACT same issue with 401K benefits. Gusto deducts 1 line amount for benefits, but these should be separate as 401K employee paid, and 401K employer paid.

You can imagine I am pulling my hair out for my new business in 2023.

 

[inconditusunus]

@nick83 Has this been happening since day one of using Gusto?

 

[nick83]

@inconditusunus Yes. Every single month.

Same issue with the 401k: one $ line for the Company Benefits, but this consists of

Employer paid 401K (25% salary match per IRS rules)

Employee Paid 401K (whatever they elect, which since is me is $19,500

Seems wrong and creates a lot of work unless i allowed to deduct BOTH of these as employer expenses.

 

[inconditusunus]

@nick83 Yeah Idk why they would separate everything like that but this is something that Gusto seems to do with their customers. Do you use one of their integrations to a preferred 401k partner?

 

[nick83]

@inconditusunus Well the 401K part i have figured out it - the transactions themselves at least were not a gusto thing. At least that is resolved. (Instead of splitting employer and employee there I am submitting as 2 seperate transactions going forward).

 

[inconditusunus]

@nick83 Ahh gotcha. Yeah so I work for a competitor of Gusto and this is something we see all the time and why companies have moved to us. It sounds like you are doing a lot of manual work and paying for a service that shouldn’t make life more difficult.

I’m with Heartland and we are a top 5 payroll provider in the US so if you want to have a comparison and see how much your life and stress levels will improve I’m more than happy to get some of your details and set up a time to talk further.

 

[nick83]

@inconditusunus As long as fees are less than $48/month for a small business and I am not bait and switched with things like creeping rates (ADP) and a small fee of only $99 for W-2 printing (another one i used). I have been burned too many times. Honestly I could probably do it myself but my monthly fee is to not think about it.

EDIT:: Yeah see your already at $89/month so you cant compete. That is $492 extra per year to avoid this issue. No thanks.

 

[inconditusunus]

@nick83 I have no idea where you got $89/month because that’s not at all accurate. ADP will get you on a certain amount of “free” months and a low monthly rate but after one year they’ll hike up your price significantly. And Gusto might be cheaper but you’ll be stuck doing things manually.

I’m also not going to play the game of race to the bottom. You get what you pay for and if you’re only interested in going with the cheapest option then you’re probably right, we aren’t a good fit. We have 3-year price locks and we control pricing based on individual client needs.

 

[nick83]

@inconditusunus Simply typing heartland payroll and immediately clicking on price. I do not read between the lines, so while am open to switching saw price and immediately closed the site.

https://www.heartland.us/pricing/payroll-plus

If that is not the price your web designer needs to be fired. haha

I have a 1 person S-Corp with the most simplest of needs. Extract payroll and payments for 1 employee, submit taxes to uncle Sam (US Based), and run EOY reports. Other than this issue of having to apparently do journal entries for my tax liabilities never had an issue. But for that alone I am open to switching.

 

[inconditusunus]

@nick83 I’ll see in the morning and get back to you.

 

[inconditusunus]

After reviewing the situation, I believe it’s possible to lower the price to your desired level, but it would require approval. However, this process may not justify the time and effort for either of us.

 

[whimawan]

@nick83 Oof, I feel your pain! This is one of those payroll headaches that really throws a wrench in clean P&L reporting. Have you reached out to Gusto's support team? Sometimes they have custom reports or export settings you can tweak to split out the employee/employer portions of taxes and benefits.

Or maybe your accounting software can handle this split automatically? Try to look for features like rules-based categorization or the ability to split transactions. Even with a bit of initial set-up, this could save you loads of manual work down the road.

If all else fails, a specialized payroll service like Paystreet.com might be worth considering. I'm currently using it and they cater to the complexities of separating employer and employee liabilities. It has definitely been less hassle since I started using it.

Anyway, let us know how it goes! And if you do end up contacting Gusto, I'd be curious to hear the solution they provide.