Payroll for solopreneurs — S-corp setup included

Once you elect S-corp status and start paying yourself a salary, you're legally an employee of your own business — so that salary has to run through actual payroll, not a transfer to your personal account. Payroll is what handles the FICA withholding, W-2 generation, and the quarterly and annual filings the IRS requires for wages. Skipping it, or running it by hand, is a common pitfall that causes solopreneurs to lose the tax benefit S-corp status is supposed to provide. You don't need an enterprise HR platform for this — Gusto Solo is built for one-person S-corps, so payroll runs automatically once it's set up.

Yes. If you already have an accountant or bookkeeper, Gusto is built to work alongside them, not replace them — you can give them direct access to your payroll and financial data, so they have what they need at tax time without manual exports or back-and-forth emails. If you don't have one yet, or want someone who specializes in S-corp solopreneurs, the Gusto Partner Directory connects you with credentialed accountants and bookkeepers who already know how to work with Gusto data.

A lot of solopreneurs figure they can pay themselves one lump sum at the end of the year and call it done. It's a reasonable instinct — but putting off your own paycheck doesn't necessarily pay off in the long run. Payroll taxes are due throughout the year, not just at tax time, and skipping enough runs lets late-deposit penalties stack up before you notice. Worse, it's not compliant — and it undoes the exact savings you elected S-corp for.

The good news: Gusto Solo takes payroll off your plate. It calculates your withholdings, helps keep your filings on schedule, and generates your W-2 automatically so you can focus on the work.

We'll guide you through every step. Share your business details, and we'll use them to prepare your S-corp election (Form 2553) and any required state registrations — prefilled and ready for your signature, postage included. Next, we'll help you land on a reasonable, compliant salary based on your income and industry. Choose your pay schedule, and then your first payroll run — and every one after it — is ready to go automatically.

That's the first month: a handful of guided steps up front, then you step back, focus on the work, and wait to get paid.

As a Gusto Solo customer, nothing about your setup changes if you decide you need to bring on an extra hand or two — you just add them. Because your S-corp payroll is already running on Gusto, bringing on your first W-2 employee or 1099 contractor means adding them to the account you have, not migrating to a new platform or starting over. Gusto scales with you into a Simple or Plus plan when you're ready, and your payroll history carries over.

We’ve broken down the steps into two parts: what to do before setting up payroll, and how to kick-start the process. You can learn all the ins and outs here—ideal for solopreneurs navigating S corp responsibilities for the first time.

Maybe. If withholding won’t cover your total bill, add estimated payments. A simple guardrail: aim to cover last year’s total tax (or about 90% of this year) through a mix of withholding and estimates—then adjust mid-year if profits jump. Form 941 reports payroll withholding; quarterly estimates cover additional tax on S corp profits passed through to you.

Have the company pay or reimburse your premiums, include that amount in W-2 Box 1, and you can often take a personal deduction if you’re eligible. Mark your calendar for year-end reporting—timing matters to keep the deduction intact.

W-2 wages only. Pay yourself enough salary to hit your retirement target, then make both employee deferrals and employer contributions up to the annual limits. Review contributions late in the year so strong profits don’t go unused. Learn more here