Houzz Pro and Gusto: Managing Payroll for Your Team

There's a version of running a team that feels like running a second business, one made entirely of paperwork, deadlines, and rules that seem designed to trip you up. And then there's the version where you actually get to focus on the work.

The difference usually comes down to whether you have the right systems in place. Payroll isn't glamorous. But getting it right is one of the most meaningful things you can do for your team and for your business. This guide walks you through what you actually need to know, without the jargon, so you can get back to the part you love.

Nearly two-thirds of Houzz Pro users employ at least one person, and more than a quarter of them have five-plus employees. Fortunately, the ease of tracking time in an all-in-one software solution reduces the hours spent on admin, freeing up their entire team to continue delivering great projects and an amazing client experience.

Payroll Is More Than Just Paying Your Employees. Here's What's Actually Happening

Most people think of payroll as the moment money moves from their account to a team member's. But under the hood, quite a bit more is going on. And if you don't know what that is, it's easy to fall behind.

• The difference between paying someone and actually running payroll
• What kicks in the moment you hire your first W-2 employee: withholding, employer taxes, state registration
• Why getting this wrong is expensive and surprisingly common, even for pros who've been at this for years
• The real time cost: How many hours are you spending on this every month?

Don’t fret: Being able to track all your time entries—and approvals—in Houzz Pro reduces any surprise issues or errors when running payroll.

Employee or Subcontractor? Get This Right Before You Hire

This is a common and costly mistake in construction and design. Misclassifying workers can mean back taxes, penalties, and audits. And, "We've always done it this way," isn't a defense.

• What actually makes someone a W-2 employee in your business
• What makes someone a 1099 subcontractor, and when that classification actually holds up
• A simple test to apply before your next hire
• Why this matters more as your team grows

Remember, subcontractors are different from contract employees. A subcontractor hired to do framing work, for example, may need a 1099 at the end of the year but would typically be paid by a check or bank transfer. A contract employee who is “on staff” (an admin assistant or design assistant, for instance) may also need a 1099 but could be paid through Gusto.

How to Set Up Payroll the Right Way

A numbered checklist you'll actually use:

1. Get your EIN (Employer Identification Number). If you don't have one, start here.
2. Register with your state for payroll tax withholding.
3. Collect a W-4 from every new hire.
4. Choose a pay schedule that works for your business: weekly, bi-weekly, or semi-monthly.
5. Decide how you'll run payroll: manually, spreadsheet, or software.
6. Set up direct deposit.
7. Know your deposit and filing deadlines (Form 941 and your state equivalents).
8. Keep records. Know what you're required to retain and for how long.

Gusto handles steps 2 through 8 automatically and keeps you covered when the rules change.

Companies already using QuickBooks can continue to track time and approvals directly in Houzz Pro, while Gusto runs payroll and pushes all the payroll entries to their QuickBooks (as long as it’s connected). That way, every dollar paid to the employee and state (plus a payroll processing fee) is accounted for, with no manual entry needed.

Your Team Doesn't Look Like Everyone Else's. Your Payroll Shouldn't Either

Houzz Pro users run different operations. This section meets three different realities on where they are.

You Just Hired Your First Employee

• What changes immediately and what to do in your first 30 days
• The most common mistakes first-time employers make (and how to skip them entirely)
• What you'll wish someone had told you earlier

You're Running a Small Team (2 to 10 employees)

• Managing different pay rates, roles, and overtime on project-based work
• Keeping payroll consistent through slow seasons and project gaps
• When a spreadsheet stops being enough

You're Building Something Bigger (10+ employees or a mix of W-2 and 1099)

• When to stop running payroll by hand, and what that decision actually costs you
• Managing payroll across job sites, projects, and roles
• When the benefits conversation needs to happen

Payroll Taxes: What You Actually Owe and When

Nobody loves this topic. But understanding it means no surprises and no penalties. That's worth a few minutes of your time.

• Federal payroll taxes: what they are, and what you as the employer owe (not just the employee)
• State and local taxes: why this varies and what to check for your situation
• Quarterly vs. annual filing: what the real calendar looks like
• What happens if you miss a deposit deadline, and how to get back on track
• Year-end: W-2s, 1099s, and what to start pulling together in Q4

Even during your busy season, you can continue to focus on projects and not taxes since Gusto handles all your payroll tax filings.

Compliance Moves With Your Business. So Should Your Systems

Getting set up correctly is step one. Staying compliant as you grow is the part most people underestimate.

• New hire reporting requirements at the federal and state level
• Labor law documentation (the posters, the records, the things you didn't know you needed)
• When you're required to offer benefits, which varies by state and headcount
• Minimum wage changes and how to stay current
• What changes when you cross 50 employees: ACA, FMLA, and what comes next

Small teams get smarter through systems. As you scale, you can be confident that you’re staying compliant with all the requirements and documentation at both the federal and state level.

The Right Tools Make All This Manageable

You built your business on the right tools for the craft. Your operations deserve the same care.

A growing number of software solutions handle the heavy lifting of payroll, calculating taxes, filing on your behalf, running direct deposit, and alerting you when something in the law changes. For Houzz Pro users, that now includes a direct connection to Gusto, which means your team management and your payroll can live in the same workflow instead of across multiple different tabs.

It also means running your payroll will be even simpler. You can continue job costing and tracking profitability in Houzz Pro, making sure you’re not over hours on your budget. After going through an approval process, time entries are pushed to Gusto, where payroll is run, giving you more time to focus on winning projects and making money.

Your Team Showed Up for You. Make Sure the Back Office Shows Up for Them

You carry a lot. Payroll shouldn't be the thing that keeps you up at night, not when the right tools exist to handle it for you, every pay period, without the stress.

Gusto handles payroll, taxes, and compliance—so you can stay focused on the work that built your business. Houzz Pro users get their first month free.