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      How does the Gusto Payroll integration work?

      Gusto (formerly ZenPayroll) integrates with FreshBooks to bring you payroll, W-2s, 1099s, payroll runs and direct deposits. The Gusto integration allows you to automatically import Payroll Runs as categorized Expenses and manage your Payroll Runs from within your FreshBooks account.

       

      Gusto is available for businesses based in the US only. Syncing Payroll Information is only available for certain users for now, our Product Team is working to make this available for all soon.

       

       

      Import Payroll Expenses

      Gusto can import every Payroll Run you complete into FreshBooks as Expenses with the appropriate Expense Categories automatically. Set this up using the below steps:

      1. Click on the gear icon in the top left corner
      2. Click on Payroll Settings
      3. If you already have a Gusto account, click on the Import Expenses button
      4. If you’ve never set up Gusto before, click on Create a Trial Account to get started with a free 2-month trial
        1. You’ll be taken to Gusto’s signup page, enter your signup details and click on Get Started
        2. Add your Password and any extra details, then click on Create My Account
      5. After your Gusto account is set up, inside Gusto, click on the App Directory tab
      6. In the Find an app search bar, type in FreshBooks and click on the result
      7. Click on the Connect button
      8. Then choose the at my.freshbooks.com option

        Connect to FreshBooks button.

      9. Enter your FreshBooks login credentials (if prompted to) and click on Allow to authorize Gusto to access your FreshBooks account
      10. Choose the business (if you have multiple) that you’d like Gusto to connect to and click on Connect to FreshBooks
      11. Once connected, click on the edit button to customize your Account Mappings to determine which Expense Categories you'd like Gusto to use when importing expenses into your FreshBooks account (Parent Categories can only be selected)
      12. In your Gusto account, click on Settings while inside the FreshBooks Integration

        Gusto app with integration settings for FreshBooks.

      13. For Auto-Sync, ensure Auto sync is selected so Payroll Runs are automatically imported into FreshBooks for you
      14. If needed, under Grouped mapping, choose Department from the dropdown to enable Department Account Mapping if needed
      15. For Entry Date, choose between Check Date, Debit Date, or End of Pay Period for the date of the Expense when it’s created in FreshBooks. Once you’ve reviewed your Settings, your integration is all set up.

       

      Note: If you’re using Bank Reconciliation as well, we recommend working with your Accountant on the mapping of your Gusto payroll expenses.

       

      Import Payroll Information

      To access your Gusto Payroll runs in your FreshBooks account, use these steps:

      1. In FreshBooks, click on My Team
      2. Then click on Payroll underneath My Team

        Payroll section in navigation.

      3. If you haven’t connected your Gusto account for Payroll Information yet, click on Import Payroll Info, then click Continue to proceed to Gusto
      4. Click Authorize
      5. Choose which Gusto Company to import Payroll runs from (if you have multiple), then click Select. Your Gusto account will be connected and you can begin Payroll Runs.

       

      Run Payroll

      Once connected to your Gusto account, you can run payroll and see payroll information:

      Payroll area with payroll details.

      • Run Payroll in Gusto - This opens your Gusto account so you can run a Payroll cycle for your team
      • More Actions - Click on Payroll Settings to manage your integration with Gusto
      • Payroll Information - Your Last Payroll Run, Last Payroll Total, Next Payroll Period and Next Payroll Run are displayed with the date and time of your last sync listed
      • View Payroll Reports - Click on the View Reports in Gusto button to run or export your various Reports from within your Gusto account
      • Last Payroll Runs - Each Payroll Run is listed with its Period, Payroll Date, Amount and a quick link to view it inside your Gusto account


      Notes:

      • When you’ve completed a Payroll Run, refresh your FreshBooks account to see the run appear in your Last Payroll Runs
      • If you cancel your payroll run inside Gusto, all imported Expenses in your FreshBooks account by Gusto will be removed automatically

       

      Manage Payroll Settings

      Access your Gusto settings using the below steps:

      1. Click on the gear icon in the top left corner
      2. Select Payroll Settings


      From here you can:

      • Run Payroll in Gusto - This opens your Gusto account so you can run a Payroll cycle for your team
      • Manage Gusto Integration Settings
        • Automatically Import Expenses to FreshBooks
          • Manage Gusto Account - Click to manage your integration with FreshBooks in your Gusto account
          • Import Expenses / Disconnect Expenses Info - Click to start or stop importing Payroll Runs as Expenses in your FreshBooks account
        • Import Payroll Information to FreshBooks
          • Import / Disconnect Payroll Info - Click to start or stop syncing Payroll runs from Gusto into FreshBooks
          • Switch Company - Click to switch between multiple companies in your Gusto account to view different payroll information in your FreshBooks account

       

      FAQs

      What happens to my Expenses if I have both the Gusto integration and a Bank Connection?

      If you have Gusto integrated, your payroll runs are automatically imported as Expenses. If you also have a bank account connected via Bank Connections that is also the same account you use for payroll runs, you will also see the same payroll runs automatically imported as Expenses too.

      To handle the duplicates, you will need to either:

      • Delete all payroll expenses imported in by Gusto and keep the bank account imported ones
      • Or delete all payroll expenses imported in by your bank account and keep the Gusto imported ones

      This ensures you only have one copy of your payroll expenses in your Expenses, rather than double-reporting them.



      How can I match my Gusto payroll transactions in Bank Reconciliation?

      Gusto will import specific Expenses into your FreshBooks account, which will also appear in your Bank Rec under FreshBooks Entries:

      • Gross Wages - Depending on your setup in Gusto, this may also be imported with more details into different Expense Categories - by default, this is assigned the Subcategory of Wages, under the Category of Other Expenses
      • Employer Taxes
      • Payments to contractors (if applicable)
      • Reimbursements to employees (if applicable)

      When your payroll is withdrawn from your bank account, these entries appear in your Bank Rec under Unreconciled Bank Transactions:

      • Total employer and employee taxes - Both State and Federal are combined into one entry
      • Net pay for employees
      • Payment to contractors (if applicable)
      • Reimbursements to employees (if applicable)
      • Payments for child support benefits to employees (if applicable)


      To reconcile Gusto entries, because matching many to many transactions in Bank Rec isn’t available yet, you will need to mark these imported transactions as Transfers. The effect on your books is an increase in your overall Expenses and a decrease in your Bank Account (part of the Cash Parent Account).

      This will result in an overall net zero effect on the Petty Cash Account - the amount being reconciled will first decrease it upon import, then increase it upon being Marked as Transfer.


      Reconcile Gusto entries using the below steps:

      1. In your Bank Rec widget, find the Gusto transactions for one payroll period under Unreconciled Bank Transactions, add them up and ensure the total equals the Gusto transactions under FreshBooks Entries too
      2. If both totals match, check off the boxes next to Gusto transactions under Unreconciled Bank Transactions
      3. Then click on Mark As button
      4. Select Transfer
      5. Leave the Gusto transactions under FreshBooks Entries unmatched.


      Notes:

      • The Gusto integration does not withdraw from your bank account for employee benefits but it still imports into your FreshBooks account as Expenses - work with your Accountant to record a Journal Entry for the Liability related to the benefits in FreshBooks
      • Any payments made for child support garnishments are already recognized by Gusto as an expense and are withdrawn from your bank account as a separate transaction

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