How to Set up QuickBooks for Nonprofits: Step-by-Step Guide

Thursday, April 9, 2026 by Christian Spearow

As your nonprofit expands and evolves, its financial situation will naturally become more complex. While you likely started out managing your organization’s finances in a spreadsheet, you’ll probably outgrow this method fairly quickly (if you haven’t already) and need to invest in specialized software to maintain compliance and ensure your accounting practices support your mission long-term.

One of the best-known—and most effective—accounting solutions your organization can invest in is QuickBooks Online. In this guide, we’ll explain everything you need to know to configure and use this powerful, trusted platform, including:

• QuickBooks Online for Nonprofits FAQ
• How to Set up QuickBooks for Nonprofits in 5 Simple Steps
• Ways to Use QuickBooks at Your Nonprofit

Despite QuickBooks Online’s usefulness, it isn’t exclusively designed for nonprofits, which is why proper configuration is essential for your organization to make the most of the platform. Let’s get started!

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QuickBooks Online for Nonprofits: Frequently Asked Questions

What is QuickBooks Online?

QuickBooks Online is a cloud-based accounting solution developed by Intuit for organizations in all verticals, including nonprofits. The main benefit of this cloud-based nature is that your team can access the QuickBooks Online platform from anywhere with an internet connection. This functionality makes it easy for staff members and outsourced financial professionals who work in different locations to collaborate in a secure environment.

Can nonprofits use QuickBooks Online?

Yes! Although QuickBooks was originally designed for business use, it can be adapted for nonprofit accounting. Because your organization can’t turn a profit by definition, its goal in using QuickBooks differs from that of a business—to ensure accountability in financial management, rather than to track profitability. So, QuickBooks has customizable settings that align with the fund accounting system your nonprofit uses to achieve this goal.

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Is QuickBooks Online free for nonprofits?

No. QuickBooks is subscription-based for all organizations. However, free trials are available, as well as discounts you can obtain by purchasing your subscription through TechSoup or certain nonprofit accounting firms. While you’ll need to budget more carefully to use QuickBooks long-term than you would if you went with some other solutions, remember that free isn’t always better in terms of functionality and scalability.

What if QuickBooks Online can’t fully support my organization’s accounting needs?

QuickBooks Online is relatively scalable, so you can upgrade your plan if you need access to more features to manage all of your nonprofit’s financial activities. However, if your organization is on the larger side and still needs more functionality, Intuit Enterprise Suite (IES) may be a better option. Because the same company makes both IES and QuickBooks Online, your data will transfer automatically if you switch from the latter to the former, so it’s a relatively easy transition.

How to Set up QuickBooks for Nonprofits in 5 Simple Steps

Now that you understand the basics of QuickBooks Online for nonprofits, let’s walk through the setup process. To help you stay organized, we’ve created a handy checklist so you can track your progress as you configure your accounting software to your needs.

1. Choose a QuickBooks Online Plan

Most nonprofits that use QuickBooks Online choose either the Plus or Advanced subscription plan. Let’s look at a few of the key differences between these plans.

QuickBooks Online Plus

If you purchase your subscription directly from Intuit, QuickBooks Online Plus costs $57.50/month for the first three months and increases to $115/month after that. With this plan, your organization will get access to all of the platform’s core nonprofit accounting features for up to five users, such as:

• Automated recordkeeping for various transactions
• Revenue and expense categorization
• Budget, donation, and grant tracking
• Custom report generation

QuickBooks Online Advanced

When purchased directly from Intuit, the QuickBooks Online Advanced plan costs $137.50/month for the first three months and then increases to $275/month. In addition to providing access for up to 25 users, some of the extra features that an Advanced subscription offers include:

• Batch invoices and cost reports
• Automated revenue recognition
• Auto-tracking for fixed assets
• Expanded data restoration and sync capabilities

If your nonprofit is investing in accounting software for the first time, the Plus plan will probably meet your needs. However, if your organization has a more complex financial situation that could benefit from additional user permissions and more extensive functionality, it’s worth upgrading to the Advanced plan.

2. Modify Account Settings for Your Nonprofit

Once you’ve chosen your QuickBooks Online plan and answered the initial setup prompts, you’ll be taken to the main dashboard to start configuration in earnest. Click the gear icon in the top right corner to modify your account settings, beginning with your nonprofit’s:

• Name and logo
• Fiscal year start date
• Accounting method (cash or accrual)
• User permissions
• Company type/tax form

The most important setting to double-check is the company type, which should naturally be “Nonprofit Organization.” This selection ensures QuickBooks will configure your accounting system to align with the information on IRS Form 990 so you can file your tax return accurately.

3. Configure Data Storage & Integrations

Next, you’ll need to take a few actions to ensure data security and streamlined workflows in QuickBooks. In particular, you should check that your information automatically backs up to the QuickBooks Online cloud so it’s always accessible and up-to-date, and sync your nonprofit’s bank accounts with QuickBooks for easy reconciliation.

Setting up integrations is also essential at this stage. Your team can save time and reduce the risk of errors that accompany manual data entry if your accounting software can “talk” directly to your nonprofit’s CRM, online donation processor, event management tools, payroll system, and other solutions in your tech stack.

Additionally, spend some time familiarizing yourself with the platform to understand where all of the major documents and types of data are stored. That way, it’ll be easier to find specific information later.

4. Customize the Interface

As previously mentioned, QuickBooks was originally developed for businesses rather than nonprofits. So, there are a few settings you should change to adapt the platform to your financial management model, such as:

• Form styles. QuickBooks’ default sales receipts are very business-oriented, but your nonprofit can customize the templates to turn them into branded donation acknowledgments with just a few clicks!
• Financial statement terminology. In QuickBooks, the statement of activities is called the Profit and Loss by Class Report, but you can easily change the name to avoid confusion.
• Classes. If you enable classes in QuickBooks' nonprofit interface, the platform will organize your expense records by function (program, administrative, or fundraising) and categorize your revenue data by source.

You’ll also need to manually create two extra classes for permanently and temporarily restricted funds, since QuickBooks doesn’t track them directly.

5. Create Your Chart of Accounts

Your nonprofit’s chart of accounts serves as a directory of all of the financial information you store in QuickBooks Online. QuickBooks has its own numbering system for charts of accounts that is also fairly business-oriented rather than nonprofit-specific. For clarity and consistency, we recommend also customizing this resource to align with the numbers on the Unified Chart of Accounts:

• Assets (what your nonprofit owns): account numbers beginning with 1000
• Liabilities (what your nonprofit owes): account numbers beginning with 2000
• Net assets (what your nonprofit is worth): account numbers beginning with 3000
• Revenue (what your nonprofit earns): account numbers beginning with 4000-6000
• Expenses (what your nonprofit spends): account numbers beginning with 7000-9000

When you assign these numbers to each of your nonprofit’s financial designations, you’ll end up with a chart of accounts that looks something like this:

Ways to Use QuickBooks at Your Nonprofit

Once you set up your chart of accounts, you’re ready to start using QuickBooks Online! Here are a few ways your nonprofit can leverage this solution in its bookkeeping and accounting practices:

• Recording transactions. Whenever your nonprofit spends or brings in money, your bookkeeper will ensure the information is recorded in QuickBooks. While they may still need to do some manual data entry, QuickBooks’ integrations and automation can streamline this process and allow them to focus on more complex bookkeeping tasks like allocating expenses and running payroll.
• Tracking restricted funds. Although you need to set up this tracking manually, the QuickBooks platform can organize your revenue into unrestricted, temporarily restricted, and permanently restricted categories. This makes it much easier to honor donors’ restrictions on their contributions and spend the right money on the right projects.
• Comparing budgeted vs. actual numbers. If you create your nonprofit’s annual operating budget in QuickBooks, you can easily refer back to it to ensure you’re on track with spending and fundraising and make adjustments as needed throughout the year.
• Managing grants. QuickBooks also allows you to upload grant budgets and create invoices specifically for recording grant funding so you can lay the groundwork for effective grant management and reporting.
• Creating financial statements. Along with the aforementioned statement of activities, your nonprofit can pull its annual balance sheet, functional expense report, and monthly cash flow statements directly from QuickBooks to promote external transparency and allow for better internal decision-making.
• Filing tax forms. In addition to your Form 990, QuickBooks is also helpful for doing your due diligence as an employer each year by filling out individual W-2s and 1099s for each of your nonprofit’s employees and contractors, respectively.

Although QuickBooks Online simplifies all of these processes, it’s still most effective to navigate them with expert help from nonprofit financial professionals, like the team at Jitasa. QuickBooks setup comes standard with our bookkeeping and accounting services, and our experienced accountants are prepared to answer any questions you may have and help you make the most of the platform based on your organization’s unique needs.

QuickBooks Online is a robust accounting solution that can benefit your nonprofit’s financial management efforts greatly—as long as you configure and leverage it correctly. Follow the steps above to get started, and don’t hesitate to reach out to nonprofit financial professionals (like the team at Jitasa!) if you have any questions or want to learn more about maximizing your investment in your accounting software.

For more information on integrating QuickBooks into your nonprofit’s accounting practices, check out these resources:

• Nonprofit Form 990 Filing: FAQ Guide + How to Get Started. Learn the basics of filing your nonprofit’s annual tax returns, which all of your other activities in QuickBooks Online should support.
• Understanding & Applying GAAP for Nonprofits: FAQ Guide. Discover what the Generally Accepted Accounting Principles (GAAP) are, why they matter, and how the right accounting software can help your organization comply with them.
• Nonprofit Bookkeeper vs. Accountant: What’s the Difference? Explore the roles of nonprofit bookkeepers and accountants, the two professionals who will probably work in your organization’s QuickBooks Online account most often.

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