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Gusto vs Square Payroll: local tax filing against a lower price and more states
Updated Oct 15, 2026
Gusto Simple costs $49 a month plus $6 per person, $79 for five employees; Square's full-service payroll costs $35 plus $6 per person paid, $65 for five. Gusto files federal, state and local taxes but covers one state on Simple. Square files federal and state taxes and includes multistate payroll, but no Square page says it files local taxes. Square pays next business day when you fund payroll from your Square balance.
At a glance, by our score
#2 Gusto
Single-state teams that want federal, state and local taxes filed for $79 a month for five employees
9.0/10ExcellentOur scoreVisit GustoOn gusto.com- Lowest price
#3 Square Payroll
Square sellers who want tips and timecards imported, at $65 a month for five employees
8.4/10Very goodOur scoreVisit Square PayrollOn squareup.com
Square Payroll's lowest monthly price is lower than Gusto's, checked Sep 27, 2026 and Sep 27, 2026.
Side by side
| Criterion | Gusto | Square Payroll |
|---|---|---|
| Overall score | 9.0/10ExcellentOur score #2 of 7 | 8.4/10Very goodOur score #3 of 7 |
| Cost for five employees (35%) | 8.6 / 10 | 9.2 / 10 |
| Included on the entry plan (20%) | 10.0 / 10 | 10.0 / 10 |
| Tax filing (20%) | 10.0 / 10 | 6.0 / 10 |
| Tax accuracy guarantee (10%) | 10.0 / 10 | 10.0 / 10 |
| Support (10%) | 10.0 / 10 | 10.0 / 10 |
| Free trial (5%) | 0.0 / 10 | 0.0 / 10 |
| Price from | $6 / month | $0 / month |
| Best for | Single-state teams that want federal, state and local taxes filed for $79 a month for five employees | Square sellers who want tips and timecards imported, at $65 a month for five employees |
| Visit | Visit GustoOn gusto.com | Visit Square PayrollOn squareup.com |
Who should pick which
- Gusto: Single-state teams that want federal, state and local taxes filed for $79 a month for five employees
- Square Payroll: Square sellers who want tips and timecards imported, at $65 a month for five employees
At a glance
| Gusto | Square Payroll | |
|---|---|---|
| Entry plan and billing | Simple: $49 a month + $6 per person, monthly, no contract | Full-service payroll: $35 a month + $6 per person paid, no long-term contract |
| Cost for five employees | $79 a month | $65 a month |
| Tax filing | Federal, state and local, plus W-2s and 1099s; one state only | Federal and state, plus W-2s and 1099-NECs; its pages don't say it files local taxes |
| Included on the entry plan | Unlimited runs, direct deposit, employee app, contractor payments, state new-hire reporting | Unlimited runs, direct deposit, Square Team App, contractor payments, new-hire reporting |
| Tax penalty guarantee | Yes, for penalties from a "Gusto Error" (payroll terms) | Yes, for its erroneous or late reporting (help article) |
| Support | Call or chat in business hours; 24/7 help centre | Phone Monday to Friday, 6 a.m. to 6 p.m. PT, and chat |
| Free trial | No; you pay nothing until you run payroll | Its pages don't say |
Prices and features from Gusto's pricing page and Square Payroll's pricing page, read Sep 27, 2026.
Price
Both charge $6 per person a month; the base fee is the difference. One employee costs $55 a month on Gusto Simple and $41 on Square. Five cost $79 and $65, $14 a month apart.
Neither shows an introductory price. Square's pricing FAQ gives the regular price ("$35 per month, plus $6 per person paid per month"), and it says there's no commitment or long-term contract. Gusto says "No contracts" and "Switch or cancel anytime".
Square charges $3 a year per employee or contractor if you want paper W-2s or 1099s mailed; digital delivery is included.
Where they differ
- Local taxes. Gusto files federal, state and local tax forms on every plan (pricing page). Square's pricing page automates federal and state filings; its payroll terms say the service "may not meet all federal, state, and local payroll obligations". No Square page says it files local taxes, so we read it as federal and state.
- States. Square's full-service plan lists "Multistate payroll" as included, with no extra fee stated. Gusto Simple is single-state; multi-state starts at Plus ($80 + $12 per person).
- Pay speed. Square pays by direct deposit on the next business day when payroll is funded from your Square balance (help article); otherwise two-day or four-day. Gusto sells next-day pay to Simple at $15 a month plus $3 per person.
- Trial. Square's pages don't mention a free trial. Gusto has none on Simple; you pay nothing until you run payroll.
- Support. Square offers phone support Monday to Friday, 6 a.m. to 6 p.m. PT, and chat. Gusto Simple has call or chat in business hours and a 24/7 help centre.
Both say they pay penalties caused by their own filing errors: Gusto in its payroll terms, Square in its help centre.
Who should pick which
Pick Gusto if you have local payroll taxes to file and your team works in one state.
Pick Square Payroll if you sell through Square and want payroll funded from your Square balance with next-day deposits, or you pay staff in more than one state, and have no local payroll taxes to file.
Both appear in our payroll services ranking and our list for construction and trades. Scoring is on the methodology page.