If you use Gusto, you shouldn't have to do much to make sure that your payroll expense accounts are correct. Since we integrate directly with their API, we are able to make most of the accounting entries for you.

We use clearing accounts for this. See more here.

The most common mistake is that you have moved a payroll transaction from Salaries and Benefits Clearing to the actual expense side.

This is an understandable, and easily remedied mistake.

To see if this is the root cause, go to your balance sheet (Dashboard/Balance Sheet/Year to Date/Show by Months).

If you see an increasing balance in the Salaries and Benefits Clearing account, you probably have to move some or all of the cash transactions to Gusto from the expense account to Salaries and Benefits Clearing.