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Tax reconciliation debits

As each payroll is processed, Gusto debits the appropriate payroll taxes that apply to your company. We then file and pay all of your quarterly and annual taxes.

If adjustments are made to your account that affect the amount of taxes owed you may be liable to pay more to the federal and state agencies. To accommodate this difference, we'll debit your company for the additional taxes.

This tax reconciliation debit ensures that the correct tax amounts have been paid to each agency.

Tax reconciliation causes

  • Mid-quarter state unemployment rate change: this occurs when your State Unemployment Insurance (SUI) rate changes for the current quarter due to reasons specified by the state unemployment department. This debit typically happens at the end of the quarter.
  • FUTA credit reduction states: this occurs if you are an employer in a credit reduction state, and a higher tax is due on federal Form 940. This debit typically happens at the end of the year.
  • Non-Gusto payrolls: when you submit a non-Gusto payroll it may impact how previous payrolls should've been taxed–if any additional taxes are owed, we'll debit your account and send the tax amounts to the applicable agencies. 

View your tax reconciliation debit(s)

  1. Go to the Reports section.
  2. Click the Tax reconciliation debits tab.
  3. Under the "Actions" column, click View details.

Tax reconciliation email(s)

Quarterly and annual reconciliation debits: we’ll send an email to customers affected including the payroll tax in question, the reason for the collected tax amount, the total amount that will be debited, and the date the debit will occur. The debit typically occurs a few business days after you receive the email.

Non-Gusto payroll debits: we’ll send an email to let you know the amount due and debit your account a few business days later.


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