Gusto vs Wave: Payroll & HR Comparison (2026)

Compare Gusto and Wave for payroll, HR, and accounting. See pricing, features, and which one fits your small business budget.

Updated 2026-09 · 2026

Gusto

All-in-one payroll, benefits, and HR platform for small businesses.

$40/mo + $6/person (Simple plan)per month + per person

Strengths

+Full payroll tax filing and compliance in all 50 states
+Integrated health insurance, 401(k), and HR add-ons
+Automated W-2/1099 preparation and filing

Weaknesses

-No free tier — cost scales with headcount
-HR features locked behind Plus/Premium plans
-Overkill for solo founders or contractor-only businesses

Best for

Small businesses with W-2 employees that need full payroll tax compliance plus benefits and HR tools in one platform.

Wave

Free accounting and invoicing software with optional low-cost payroll.

Free (Accounting/Invoicing); Payroll from $20/mo + $6/employeeper month + per employee (payroll only)

Strengths

+Accounting, invoicing, and receipt scanning are completely free
+Payroll pricing is lower than Gusto in self-service states
+Simple interface with minimal setup time

Weaknesses

-Full-service payroll tax filing only available in 14 states
-No benefits administration, 401(k), or onboarding workflows
-Slower, more limited customer support than Gusto

Best for

Freelancers and small businesses that want free bookkeeping and invoicing, with only basic, low-cost payroll needs.

Feature Comparison

Feature	Gusto	Wave
Free plan	No	Yes — full accounting & invoicing free
Base payroll price	$40/mo	$20–$40/mo depending on state
Per-employee cost	$6/person	$6/employee
Full-service tax filing (all states)	Yes, all 50 states	Only 14 states; rest are self-service
Accounting/bookkeeping	No	Yes, free double-entry accounting
Invoicing	No	Yes, unlimited & free
Health insurance/benefits	Yes, integrated	No
401(k) integration	Yes (via Guideline)	No
HR tools (onboarding, PTO, compliance)	Yes, on Plus/Premium	No
Employee self-service portal	Yes, full portal	Limited to pay stubs
Contractor payments & 1099s	Yes	Yes, via payroll add-on
Mobile app	Yes	Yes

The Verdict

Gusto is the stronger choice once you have real employees and need benefits, HR compliance, and nationwide payroll tax filing handled for you. Wave wins on price for freelancers or tiny teams that mainly need free invoicing/accounting and only occasional, simple payroll. If you're outside Wave's 14 full-service payroll states, the savings shrink fast once you factor in manual tax filing work.

How to switch from Gusto to Wave

1In Gusto, go to Reports and export Payroll Journal and Payroll History for all past pay periods as CSV, then download every employee's W-2s/1099s and past tax filings as PDF since Gusto limits access to these after cancellation.
2Export your Employee and Contractor lists from Gusto's People tab as CSV, including pay rates, addresses, and tax withholding details.
3Sign up for Wave Accounting (free) and add Wave Payroll if your state supports it, checking whether it's full-service or self-service tax filing in your state.
4Manually enter employees and contractors into Wave Payroll using your exported CSV data, and input year-to-date payroll totals so year-end W-2s calculate correctly.
5Recreate any benefits, 401(k), or accounting integrations separately, since Wave doesn't support Gusto's benefits add-ons or Guideline 401(k) connection.
6Run one full pay cycle in parallel on both platforms to confirm tax withholdings and net pay match before canceling your Gusto subscription.

Gusto vs Wave: common questions

How do I export my payroll data from Gusto?+

Go to Gusto's Reports section and export Payroll Journal, Payroll History, and Employee/Contractor lists as CSV files. Also download all W-2s, 1099s, and prior tax filings as PDFs from the Taxes & Compliance tab before canceling, since Gusto restricts access to historical documents after your account closes.

What features do I lose moving from Gusto to Wave?+

You lose integrated benefits administration, 401(k) management, PTO tracking, and full HR onboarding workflows — Wave doesn't offer any of these. You also lose automatic full-service tax filing unless you're in one of Wave's 14 supported states, meaning you may need to file some payroll taxes yourself.

Is Wave's free plan actually enough for a small team?+

For accounting, invoicing, and expense tracking, yes — the free plan has no user limits or feature caps. But Wave's free plan doesn't include payroll or HR features at all; those require the separate paid Wave Payroll add-on.

Does Wave integrate with the same apps as Gusto?+

Not really. Gusto integrates with QuickBooks, Xero, and a wide range of benefits/401(k) providers, while Wave has a much smaller integration list focused mainly on Zapier and its own payment processing. If you rely on Gusto's benefits integrations, you'll need to manage those separately after switching.

Will switching to Wave actually save money long term?+

For a business with 1-5 employees in a self-service payroll state, yes — Wave's $20/mo base is roughly half of Gusto's $40/mo. But if you're outside Wave's full-service states or need benefits/HR tools, the time cost of manual tax filing and lack of HR features can offset the savings.