Running payroll used to be the most dreaded task on my small business to-do list until I decided to try Gusto payroll six months ago. This powerful platform now serves over 400,000 businesses across the country, and I wanted to see if it lived up to the hype. During my testing period, I discovered why Gusto ranks among the most popular payroll software options available today.
Beyond just processing paychecks, Gusto combines payroll, employee benefits, hiring tools, and HR features all in one comprehensive place. However, with plans starting at $49 per month plus $6 per worker, is Gusto a good payroll company for the price? After thoroughly testing its features for half a year, I’ve gathered detailed insights about everything from its unlimited payroll runs to its automated tax filing capabilities. In this Gusto payroll review, I’ll share my honest experience and help you decide if this all-in-one solution is the right fit for your business needs.
Gusto Payroll 2025: Key Specs and Who It’s For
When exploring Gusto’s platform in depth, I found that it offers considerably more than just basic payroll processing. After testing it for six months in my business, I’ve gained a solid understanding of its functionality, target market, and overall value proposition.
Platform Overview and Target Audience
Gusto’s cloud-based platform stands out with its clean, intuitive interface that feels refreshingly modern compared to other payroll software I’ve used. The dashboard presents key information at a glance—upcoming payrolls, new hire tasks, and important compliance deadlines. This straightforward design makes it particularly suitable for business owners who lack specialized payroll expertise.
I noticed Gusto specifically targets small to mid-sized businesses seeking to simplify their payroll and HR processes. The platform clearly positions itself as an all-in-one solution rather than just a payroll calculator. Notably, it’s built for companies that want to reduce administrative burden without sacrificing compliance or employee experience.
First-time business owners will appreciate Gusto’s guided setup process and built-in explanations of complex payroll concepts. As someone with limited payroll experience, I found the platform’s educational approach particularly valuable when setting up state tax accounts and configuring benefits.
Supported Business Sizes and Industries
Throughout my testing period, I discovered Gusto works exceptionally well for small businesses with under 50 employees. The platform scales reasonably well for companies with straightforward compensation structures, although businesses with complex pay arrangements might find some limitations.
Gusto caters to various industries, but I found it particularly strong for:
Service-based businesses (consulting, agencies, professional services)
Retail and hospitality with hourly workers
Startups and technology companies
Non-profits and organizations with simple structures
For my small consulting business, Gusto handled our needs perfectly, but I can see potential challenges for enterprises with international employees or extremely complex compensation models. The platform currently focuses primarily on US-based businesses, which is worth considering for companies with global operations.
Core Capabilities: Payroll, HR, and Benefits
At its core, Gusto combines three essential business functions that traditionally required separate systems. The payroll functionality extends beyond basic calculations to include features like multiple pay schedules, garnishment support, and customizable earnings and deductions—all of which I found invaluable for managing different contractor and employee arrangements.
The HR capabilities impressed me with their practical approach to employee management. Rather than overwhelming users with complex HR jargon, Gusto focuses on making essential HR tasks straightforward. The digital onboarding flows, document storage, and employee self-service portal reduced my administrative workload significantly.
Benefits administration represents another key strength in Gusto’s arsenal. The platform offers access to health insurance, retirement plans, and specialty benefits like HSAs and FSAs, depending on your location and business size. Furthermore, I appreciated being able to manage everything from a single interface rather than juggling multiple systems.
The integration capabilities also deserve mention. Gusto connects seamlessly with popular accounting software like QuickBooks and Xero, plus various time-tracking and expense management tools. This interoperability saved me countless hours of manual data entry and reconciliation each month.
Payroll, Tax Filing, and Compliance Tools
After putting Gusto’s payroll functions to the test for six months, I’ve gained firsthand experience with its processing capabilities and compliance features. The platform’s payroll tools extend far beyond basic functionality, offering substantial time-saving benefits for small business owners like myself.
Unlimited Payroll Runs and Direct Deposit Options
One of Gusto’s standout features is its unlimited payroll runs at no additional cost, regardless of which plan you choose. Initially, I was skeptical about this claim, but after running several off-cycle payments for bonuses and corrections, I confirmed that Gusto never charged extra. The platform’s AutoPilot feature further simplifies the process by automatically running payroll on schedule, which has saved me countless hours of manual work.
For payments, Gusto provides flexible direct deposit options that vary by plan. In my experience, the next-day and two-day direct deposit capabilities proved invaluable for managing cash flow. Additionally, employees can split their payments across up to five bank accounts, either by percentage or specific dollar amounts – a feature several of my team members immediately utilized.
Automated Tax Filing: Federal, State, Local
Perhaps the most stress-relieving aspect of Gusto is its comprehensive tax handling. The system automatically calculates, files, and pays all federal, state, and local payroll taxes with each payroll run. Throughout my testing period, I never had to manually file a single tax form – Gusto handled everything from Form 940 to Form 941, as well as W-2s and 1099s.
The platform keeps track of changing tax laws and performs all calculations automatically, which eliminates my constant worry about compliance errors. Moreover, these tax services come standard with every plan, unlike some competitors that charge extra for these essential functions.
Multi-State Payroll and Contractor Payments
For businesses with distributed teams, Gusto offers payroll processing in all 50 states for the same price. Since my small business employs people in three different states, this feature proved especially valuable. The platform seamlessly handles the varying tax regulations across state lines, calculating appropriate withholdings without requiring additional setup on my part.
Concerning contractor payments, Gusto streamlined what used to be a cumbersome process. The platform allows contractors to self-onboard online and automatically generates and files 1099 forms at year-end. For my international contractors, I utilized Gusto’s capability to send payments to over 120 countries, with only a small service and foreign exchange fee for each transaction.
Compliance Tools for State Registration
Consequently, one of the most underrated features I discovered was Gusto’s assistance with state tax registration. The platform provides resources to register in all states where employees live and work, which proved essential when I hired someone in a new state during my testing period.
Gusto’s state registration tools handle the necessary paperwork with state and local agencies, significantly reducing administrative burden. This streamlined process, which typically takes days or weeks when done manually, was completed through Gusto in just 3-5 business days. The platform automatically syncs registration information with your payroll settings, ensuring accurate tax rates without additional configuration.
In essence, Gusto’s payroll and compliance tools eliminated most of the administrative headaches I previously experienced with payroll processing, allowing me to focus more time on growing my business.
HR Features: Benefits, Onboarding, and Time Tracking
Beyond core payroll processing, Gusto’s HR capabilities have substantially transformed how I manage my team’s benefits, onboarding, and performance tracking over the past six months.
Health, Dental, Vision, and 401(k) Integration
Gusto’s benefits administration streamlines what used to be complex, fragmented processes. The platform allows seamless integration with existing health insurance plans while maintaining your current broker relationships. According to customer surveys, 90% of users agree that having benefits synced with payroll saves them time. For businesses with 25+ employees, this integration saves an average of 50+ hours annually on benefits administration compared to previous broker arrangements.
The 401(k) capabilities impressed me most. Gusto offers integration with major providers, including Human Interest, Betterment, and its own 401(k) solution powered by Guideline. Employees can contribute to both traditional (pre-tax) and Roth (post-tax) 401(k) accounts, with 2025 contribution limits of $23,500 for employees under 50 and higher catch-up amounts for older workers.
Digital Onboarding and Offer Letters
The digital onboarding process eliminated stacks of paperwork from my hiring workflow. Gusto provides customizable offer letter templates that include essential elements like position details, compensation information, and benefits summaries. Once candidates accept, the self-service onboarding system guides them through document completion.
What truly stood out was how the platform connects all aspects of bringing on new team members – from provisioning software access to enrolling them in benefits programs automatically. This integrated approach helps explain why Gusto ranks as G2’s #1 best software for onboarding as of Summer 2024.
Time Tracking and PTO Management
Gusto’s time tracking functionality offers remarkable flexibility. Team members can clock in/out through web browsers, the mobile app (iOS and Android), or even tablet-based Time Kiosk stations. For remote workers, optional GPS location recording provides accountability without feeling intrusive.
The PTO management system is equally impressive, allowing for customizable policies based on employment type and tenure. The platform automatically calculates time off accruals, synchronizes approved requests with payroll processing, and sends reminders when employees should consider using accumulated time. This automation has eliminated the spreadsheets I previously maintained for tracking vacation time.
Performance Reviews and Goal Tracking
To foster employee development, Gusto includes performance management tools that encourage regular feedback. The system supports comprehensive review cycles with customizable questions and multiple review types (peer, upward, downward). I particularly value how team members can request feedback from colleagues at any time, creating a culture of continuous improvement.
The goal tracking feature allows employees to create measurable objectives with specific timelines. Both managers and team members can post progress updates, marking goals as “on track,” “progressing,” or “off track. During performance reviews, these documented goals provide valuable context for evaluation discussions. This structured approach to performance management has significantly improved our team’s focus and accountability.
Gusto Pricing Plans: Which Tier Offers Best Value?
Examining Gusto’s pricing structure reveals several tiers, each offering different value propositions depending on your business size and needs. After testing each plan’s features against their costs, I’ve developed clear insights about which options deliver the most bang for your buck.
Simple Plan: $49 + $6/user
The entry-level Simple plan starts at a base price of $49 per month plus $6 per person. Designed for small businesses with straightforward needs, it provides full-service single-state payroll processing. Despite being Gusto’s most basic option, it still includes unlimited payroll runs, automated tax filings, and direct deposit capabilities. Indeed, even at this tier, you get access to essential benefits administration without additional Gusto fees.
Plus Plan: $80 + $12/user
For growing businesses, the Plus plan costs $80 monthly with $12 per employee. This mid-tier option unlocks valuable features like next-day direct deposit, time tracking with geolocation, and project tracking capabilities. The Plus plan typically offers the best balance between cost and functionality for businesses with 20+ employees that need more comprehensive HR tools. In fact, this plan introduces workforce costing reports and team management features absent from the Simple tier.
Premium Plan: $180 + $22/user
At the top end, the Premium plan commands $180 monthly plus $22 per person. This tier provides everything from the Plus plan alongside a dedicated customer success manager who collaborates with your team on strategic needs. Furthermore, Premium subscribers gain access to an HR resource center with templates for job descriptions, performance assessments, and labor law policies. Correspondingly, this plan is most suitable for larger organizations with 30+ employees requiring full compliance support.
Contractor-Only Plan: $35 + $6/contractor
For businesses working exclusively with contractors, Gusto offers a streamlined plan at $35 monthly plus $6 per contractor. Notably, this option includes unlimited contractor payments across all 50 states with four-day direct deposit. Nonetheless, Gusto periodically runs promotions waiving the base fee for the first six months, meaning you’d only pay $6 per contractor during that period.
Add-ons and Hidden Costs to Watch
Beyond the base plans, several add-ons can increase your monthly investment:
Next-Day Pay: $15 monthly plus $3 per person
Instant Pay: $100 per payroll
Health insurance broker integration: $6 per eligible employee monthly
State tax registration: Pricing varies by state
R&D tax credits: 15% of identified tax credits (discounts for Premium customers)
Ultimately, your total Gusto expense depends heavily on which additional features your business requires and how many employees you manage.
Gusto Pros and Cons After 6 Months of Use
Having thoroughly tested Gusto across my business operations, I’ve compiled a balanced assessment of its advantages and shortcomings. These insights reflect my personal experience over six months of daily use.
Top Pros: Ease of Use, Automation, Support
The platform’s intuitive design consistently impressed me throughout the testing period. With Gusto, I think of payroll as a 30-second job rather than the 30-minute headache it used to be. The AutoPilot feature automatically runs scheduled payroll without manual intervention, putting administrative tasks on autopilot.
Perhaps most valuable is how Gusto handles tax compliance. The system automatically calculates, files, and pays all federal, state, and local taxes with each payroll run. This automation effectively eliminated the constant worry about compliance errors that previously plagued my business operations.
Customer support proved exceptional, with 9 out of 10 Gusto customers recommending the service. Whenever issues arose, their team typically resolved them within 24 hours.
Top Cons: Pricing, Limited Global Support
Frankly, Gusto’s recent 23% price increase without additional features created frustration among many users. The tiered pricing structure makes it increasingly expensive as teams grow larger, with hidden costs for services like tax filings and benefits administration significantly inflating advertised rates.
Additionally, Gusto has limited capabilities for global teams. Though contractor payments work in 120+ countries, managing full-time international employees requires their more expensive Gusto Global service.
Is Gusto a Good Payroll Company for Small Teams?
On balance, Gusto delivers excellent value for small businesses with straightforward needs and primarily US-based employees. According to Forbes Advisor reviews, Gusto works best for “small businesses that have a mix of remote employees and contractors across the country.
For teams under 50 employees seeking to eliminate administrative burdens, Gusto’s combination of automation, compliance management, and user experience justifies the cost. Yet, businesses with complex international operations or highly customized needs might find the platform’s limitations outweigh its benefits.
Conclusion
After six months of putting Gusto through its paces in my small business, I can confidently say this platform has transformed our payroll experience. What used to be a dreaded monthly task has become a 30-second process that actually feels painless. The combination of unlimited payroll runs, automated tax filings, and comprehensive HR features creates a compelling package for small business owners overwhelmed by administrative tasks.
Undoubtedly, Gusto shines brightest when managing teams under 50 employees, particularly those with distributed workers across multiple states. The platform’s intuitive interface makes complex payroll concepts accessible even to first-time business owners, while the AutoPilot feature essentially eliminates the need for manual intervention during regular pay cycles.
However, the recent 23% price increase without additional functionality raises valid concerns about long-term value. Similarly, businesses with international employees might find the platform’s limitations frustrating compared to globally-focused alternatives.
Therefore, your decision ultimately depends on your specific business needs. Small US-based teams will likely find Gusto worth every penny, especially when factoring in the time saved from automated compliance management and integrated HR functions. Larger organizations or those with complex international requirements might need to look elsewhere or supplement Gusto with additional services.
My experience proves that Gusto delivers on its promise to simplify payroll and HR management. Though not perfect, the platform has earned its place as my preferred solution for handling the administrative side of running a small business. The peace of mind that comes from knowing tax filings, benefit administration, and employee onboarding are handled correctly alone justifies the investment for many small business owners like myself.