How to Set Up QuickBooks for a Church

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QuickBooks Online (QBO) is fantastic. It performs all the tasks I need and more for my bookkeeping business. I’ve set up more churches in QBO than I can count, and I’ve discovered that it works well for them too… with a few tweaks. Let me first lay some groundwork in this area. Here you will read about how to search for QuickBooks for and if you want to know more about QuickBooks features like what is QuickBooks online new features of 2022 To do then click on this links.

If your church is new or small, with few assets and liabilities, then…

You might be able to use my accounting spreadsheets for single-entry bookkeeping, for example.

However, if at all possible, double-entry bookkeeping is always the best choice. To learn the distinction between single-entry and double-entry bookkeeping, visit this page on fundamental accounting.

Features I like with QuickBooks Desktop

One-time payment secures your ownership! (Update: Techsoup now offers the desktop version for nonprofits and the online Quickbooks for almost no cost. Find out more about that offer here!)
Icons and QB Centers make it simple to access frequently used features.
Can it be password-protected
Easily manages payments, bills, and bank reconciliation
Great tools for budgeting
Processes payroll taxes and calculate payroll for an additional fee (Note: I cannot recommend using Intuit’s Payroll because I have had too many negative experiences with them personally.)
Produces checks with Microsoft Office compatible (Word, Excel, Outlook, etc)
In comparison to the online version, the desktop version allows you to create more reports.
The desktop version makes it simpler to keep track of donors.

Features available in the Nonprofit Edition

Monitoring contributors and contributions
Creating donor-specific letters and envelopes
Monitoring finances and budgets by program
preparing Form 990 or Form 990-EZ for the IRS
generating additional reports with a focus on nonprofits
can produce a class-specific Statement of Financial Position (Balance Sheet) (funds)

Features I like about QuickBooks Online

It is web-based, allowing multiple users to access it simultaneously.
You don’t have to worry about “backing it up” in the “cloud”
There are a tonne of “How To” videos available for the fundamentals, but not many that are tailored for churches, like how to track a grant?
The reports in QBO are simple to create and modify, despite the fact that there are fewer of them than in the desktop version.
Having the ability to quickly and easily create a “report package” that includes a cover sheet
connects to many different apps!

Let me now share with you what I dislike about QBO.

I dislike how it tracks donors and donations. Although it is possible, entering EVERY donation as a sales receipt takes time.

I always advise my clients to use top-notch online donation tracking tools like Breeze or Planning Center, which keep track of both online and offline donations. After that, I simply divided the deposits in QBO using the designation reports generated by those programs.

I think QBDT and QBO can be affordable options for many churches and nonprofits, to sum up. Once set up correctly, volunteers with little to no accounting experience can use it with ease.

QuickBooks Online for Churches and Not-for-Profit Organizations

This book contains hundreds of screenshots that help you set up and use QuickBooks Online (QBO) effectively.

Procedures to prevent theft and mistakes
Creating an accounting chart (with examples for different types of nonprofits in the appendix)
Transforming a QB organization on a desktop into a QBO
Tracking grants and gifts from donors
Contact details for donors and vendors are imported
Obtaining funds, paying debts, and monitoring credit card charges
Account reconciliation
Budgeting
The creation of management reports
Procedures for the month-end and year-end
Tracking donations in kind, volunteer hours, and fundraisers
And a whole lot more!

Accounting for Online Donations on QuickBooks Online

I don’t like using QBO for donation tracking. In order to properly assign the deposits in QBO, I would prefer to use donation tracking software outside of QBO.

Even though your online payment processor might deduct a processing fee before depositing the money into your bank account, if you track and record donations in QBO, you are required to record the entire donation and give the donor full credit for their contributions.

Churches and nonprofit organizations frequently use the software known as QuickBooks Online (QBO). Since I’m only a church secretary and not an accountant, I use QBO for my personal business, and I love it because it does everything I need and so much more.

With just a few tweaks, the bookkeepers/accountants I personally know who work with churches that use QBO say it functions well for them.

Using QuickBooks for Churches and Nonprofits

Single-entry bookkeeping, such as the accounting spreadsheets from FreeChurchAccounting.com, may be suitable for you if your church is a start-up or small and has few assets and liabilities.

However, double-entry bookkeeping is always the best option if possible. There are basically two bookkeeping practices (single and double-entry bookkeeping) and here is the difference between them: