Add a 529 savings plan to Gusto

You can add 529 deductions to Gusto by setting up a custom benefit. 

Before you start: You'll record employee and company contributions in Gusto as a dollar amount per pay period. If contributions are set up with your provider as percentages, check your 529 provider's records to verify the dollar amount per pay period. 

1. Sign in to your Gusto admin account.
2. Go to the Benefits section.
3. Under “Custom Benefits,” choose Custom Benefit.
4. Add a name for the benefit. This will appear on employee paystubs.
5. Under "Employee Deduction Per Pay Period," enter an amount. This is how much we'll deduct from your employees' wages each pay period.
   • If employees contribute different amounts, you can customize each person’s deductions and company contributions in step 10.
6. Enter the "Company Contribution Per Pay Period." We'll keep track of this for your records and year-end taxes. If your company contribution is set up as a percentage, refer to your 529 provider's records to add it as a dollar amount per pay period. 
7. Click Save & continue.
8. Select which employees you'd like to be deducted for this benefit.
9. Click Save.
10. If your employees each contribute different amounts or receive different company contributions, you can now edit each employee’s individual amounts:  
    • Click View benefit to see the deductions you've just set up.
    • Find the name of the employee whose deduction or company contribution you need to change and click Edit benefit.
    • Update their deduction and/or company contribution.
    • Click Save. 

On the next regular payroll you run, the deduction will show up on each enrolled employee's paystub under "Employee Earnings" as its own line item. 

Taxability 

529 contributions are post-tax, but earnings are tax-free. Any employer match is considered imputed pay, which is taxable as income. Gusto automatically records company contributions on employee tax forms.

Manage deductions

To add an employee, change an individual's deductions or contributions, or remove the deduction, check out our guide to benefit deductions.

While Gradvisor no longer sells new standalone 529 plans, any customers who already have a Gradvisor plan integrated with Gusto can keep their plan active and connected to Gusto. See below for answers to some common plan management questions.

When payroll deductions are reflected in Gradvisor 

Employees can sign in to Gradvisor to view and manage their plan. Contributions may not always show up in Gradvisor right away, depending on when in the month the payroll deductions were taken. Gradvisor runs a monthly reconciliation in the first week of the following month. 

Minimum contributions 

Many Gradvisor plans have a $25 monthly minimum contribution. If an employee elects less than this amount in Gusto, they'll still be deducted the minimum amount per your plan terms. Sign in to Gradvisor or call them directly for your plan's specific terms. 

Company billing

Gradvisor debits your company's chosen bank account for their monthly fee on the 1st of each month. This does not have to be the same bank account you use for contributions or with Gusto—sign in to Gradvisor to make any changes. 

Closing your account

If your company Gusto account is suspended, Gradvisor will no longer receive payroll data from Gusto. To close your Gradvisor account, reach out to Gradvisor directly. 

Dismissed employees

A dismissed employee can still access their 529 funds by signing in to Gradvisor.

Still need help? 

Chat with Gradvisor or call them at (866) 461-4770 between 8:30am and 6pm ET.