Off-cycle payroll is a payroll run that occurs outside of your regular pay cycle. Off-cycle payroll can be needed for a variety of reasons including issuing an employee’s final paycheck, correcting a payroll error, reimbursing expenses, salary adjustments for a promotion or raise mid-cycle, or paying commissions or bonuses. Gusto supports off-cycle, bonus, and commission payments at no extra cost.

Off cycle payrolls are often needed to send an employee their final paycheck. Different states have differing requirements on how this must be done. Some states, like Florida, have no laws surrounding final paychecks. California and Colorado, however, generally require the final paycheck be provided to employees immediately. In many other states, the final paycheck must be sent in the next regular pay cycle, and in some, it must be issued as a paper check instead of direct deposit. Rules can also be different for employees who leave voluntarily rather than being terminated by the employer. Check your state’s labor department website for more information.

With Gusto, running off-cycle payroll is just as easy as running regular payroll. Simply select “Run payroll,” choose “Off-cycle,” and add the employees you’d like to pay—whether a single worker or a bulk addition. Enter the payment amount, review tax and benefit options, and you’re on your way!

Bonus payroll is one type of off-cycle payroll that occurs outside of your regular pay cycle. However, bonus payroll in Gusto gets treated slightly differently due to tax withholding requirements. Since many off-cycle payrolls are simply regular paychecks, they are taxed normally. Bonus payrolls, however, are taxed at the supplemental withholding rate of 22%.