Is Gusto payroll compliant with all state and federal payroll regulations?

Yes, Gusto Payroll is designed to be fully compliant with all state and federal payroll regulations. The platform helps businesses manage their payroll processes in accordance with the latest laws and regulations, minimizing the risk of non-compliance. Gusto achieves this through automated tax calculations, timely filings, and comprehensive support resources. Below is a detailed overview of how Gusto ensures compliance with state and federal payroll requirements.

Compliance with Federal Payroll Regulations

Automatic Tax Calculations

Gusto automatically calculates all federal payroll taxes, including federal income tax, Social Security, and Medicare (FICA) taxes. The platform stays updated with current IRS guidelines to ensure accurate withholding and reporting. This automation reduces the risk of errors that could lead to non-compliance and penalties for businesses.

Federal Tax Filings and Payments

Gusto handles the filing and payment of all required federal payroll taxes, including Form 941 for quarterly federal tax returns, Form 940 for annual federal unemployment tax, and Form W-2 for employee wage and tax statements. Gusto submits these forms electronically to the IRS, ensuring timely and accurate filings that meet federal requirements.

Compliance with the Affordable Care Act (ACA)

Gusto provides tools and resources to help businesses comply with the Affordable Care Act (ACA) requirements. This includes tracking employee hours to determine eligibility for health benefits, generating necessary ACA forms, and ensuring that employers meet their reporting obligations. Gusto’s platform is designed to simplify ACA compliance for businesses of all sizes.

Compliance with State Payroll Regulations

State Income Tax Withholding

Gusto manages state income tax withholding for all states that require it. The platform automatically calculates the correct withholding amounts based on the employee's earnings, state tax rates, and any additional withholding allowances specified by the employee. This ensures that businesses comply with state-specific tax regulations and avoid underpayment or overpayment of state taxes.

State Unemployment Insurance (SUI) Taxes

Gusto calculates and files State Unemployment Insurance (SUI) taxes on behalf of employers. The platform tracks the SUI tax rates for each state, including any changes in rates or wage base limits, to ensure accurate calculations and timely payments. Gusto also handles the filing of state unemployment tax returns, helping businesses comply with state-specific unemployment insurance requirements.

State Disability Insurance (SDI) Compliance

In states that require State Disability Insurance (SDI), such as California, New Jersey, and New York, Gusto automatically calculates and withholds the appropriate amounts from employee paychecks. The platform manages the reporting and remittance of these funds to the relevant state agencies, ensuring full compliance with state disability insurance requirements.

Local Payroll Tax Compliance

Local Income Taxes

Gusto supports compliance with local income taxes that may be levied by cities, counties, or municipalities. The platform automatically calculates and withholds the correct amounts for local taxes, based on the employee's work location and local tax regulations. Gusto also handles the remittance of these taxes to the appropriate local authorities, ensuring compliance at all levels of government.

Other Local Taxes

In addition to local income taxes, Gusto helps businesses comply with other locality-specific taxes, such as transit taxes or municipal taxes. The platform monitors changes in local tax laws and automatically adjusts calculations to reflect the latest requirements. This comprehensive approach ensures businesses meet all their local tax obligations.

Compliance Monitoring and Alerts

Automatic Updates to Tax Rates and Regulations

Gusto continuously monitors changes to federal, state, and local tax rates and regulations. The platform automatically updates its calculations to reflect these changes, ensuring that payroll processes remain compliant with the latest laws. This proactive approach helps businesses avoid potential penalties and fines associated with non-compliance.

Compliance Alerts and Notifications

Gusto provides compliance alerts and notifications to inform businesses of upcoming filing deadlines, changes in tax laws, and other important compliance-related events. These alerts help employers stay aware of their obligations and take timely action to meet regulatory requirements.

Support for Compliance Inquiries

Access to Compliance Resources

Gusto offers a wide range of compliance resources, including articles, guides, and webinars, to help businesses understand their payroll obligations. These resources cover topics such as tax withholding, reporting requirements, and best practices for maintaining compliance with payroll laws.

Customer Support for Compliance Issues

Gusto’s customer support team includes payroll and compliance experts who are available to assist with any questions or issues related to compliance. For businesses on higher-tier plans, such as the Concierge plan, Gusto provides access to certified HR professionals who can offer additional guidance on compliance matters.

Conclusion

Gusto Payroll is fully compliant with all state and federal payroll regulations, offering automated tax calculations, timely filings, and comprehensive support resources to help businesses manage their payroll processes effectively. By continuously monitoring changes in tax laws and providing proactive alerts, Gusto ensures that businesses stay compliant with their payroll obligations, reducing the risk of penalties and fines.