There are few options to edit a payroll depending on the processing status. If anyone on your team was underpaid, run an off-cycle payroll to make up the difference (recommended), or you can reverse the payroll.
If you don't want to process an upcoming payroll, or have payrolls from the previous year that are no longer relevant, skip it instead. If you're on Payroll on AutoPilot, and you don't want to process an upcoming payroll, wait until the week before the payroll will process in order to skip it.
If your payroll hasn't yet fully processed, you can cancel it and make changes. Payrolls will fully process at 4pm PST on the day you process payroll. If you're looking to cancel a contractor payment, head to this article.
Important: Depending on the check date of the payroll being canceled, taxes may have already been remitted to the agency, meaning we can not recoup the funds from the tax agency. At the end of the quarter, when quarterly filings are submitted, the agency will recognize an overpayment of taxes on the quarterly return and issue your company a refund or credit.
When canceling a regular payroll, the payroll settings will be saved if you go back to rerun it, so you won't need to re-enter the payroll details again. You can find this saved information in the now unprocessed payroll by clicking the Payroll section and selecting Run Payroll, and following the steps as normal to reprocess it.
If you're looking to change/adjust a pay period on a payroll that has been processed, you'll need to reverse and reprocess the payroll in order to make the change. Payrolls can only be adjusted once they fully process. If you only see the option to cancel a payroll, this means it hasn't yet fully processed, and you must cancel the payroll and rerun it in order to make any changes.
If you need to adjust a payroll that you’ve already run, follow the steps below. To adjust contractor payments, click here.
Alternatively, follow the steps below to reverse or cancel an individual employee’s payroll from their people page.
Important: Depending on the check date of the payroll being canceled, taxes may have already been remitted to the agency, meaning we can not recoup the funds from the tax agency. At the end of the quarter, when quarterly filings are submitted, the agency will recognize an overpayment of taxes on the quarterly return and issue your company a refund or credit.
If the check date is within 5 days from the time you reverse it, we have one attempt to pull the funds from the employees’ bank accounts. Your bank will attempt to recover the funds 1-2 business days after you submit the reversal, and if successful, the funds will be returned to your company bank account within 5-7 business days. If our first attempt to pull the funds from your employees’ bank account is unsuccessful, or if it’s after 5 days, you’ll need to recover the money outside of Gusto externally. We'll still reverse the amounts for tax and reporting purposes.
Make sure to check your state’s overpayment laws to stay compliant before you reverse the payroll.
Note: If you're using an accounting integration, you may need to manually reconcile any reversed entries.
Certain contractor payments can be canceled or adjusted in Gusto without having to contact us for help. If you only see the option to cancel a contractor payment, this means the payment hasn't fully processed, and you'll need to cancel and rerun the payment to make any changes.