In QuickBooks Online, you can create an income and clearing account in your chart of accounts.
Step 1: Check if you already have an in-kind donation account
Make sure you don’t already have an in-kind donation account in your chart of accounts to avoid duplicates.
- Go to Settings ⚙, then select Chart of accounts (Take me there).
- In the Filter by name or number field, enter In-kind donations.
- If no account appears, you can now create an in-kind donations account.
Note: If you see an account named “In-kind donations”, your chart of accounts is already set up.
Step 2: Create an in-kind donation account
If you already have an in-kind donations account, you no longer need to create one. You can skip this step and proceed to step 3.
- Go to Settings ⚙, then select Chart of accounts (Take me there).
- Select New.
- In the Account name field, enter In-kind donations.
- In the Account type ▼ dropdown, select Income.
- In the Detail type ▼ dropdown, select Non-Profit Income.
- Select Save.
Step 3: Create a clearing account
To keep track of your in-kind donations, create a clearing account. This helps you to record your in-kind donations’ sales receipts or bill payments.
- Go to Settings ⚙, then select Chart of accounts (Take me there).
- Select New.
- In the Account name field, enter In-kind Clearing.
- In the Account type ▼ dropdown, select Bank.
- In the Detail type ▼ dropdown, select Checking.
- In the Opening balance field, enter the opening balance amount. Then, select the starting date in the Date field.
Note: The opening balance can be $0. - Select Save.
Step 4: Create a product or service item
Create a product or service item for each in-kind donation you receive and accurately track what you have. This allows you to record in-kind donation items to your books for a more detailed financial report.
- Go to Settings ⚙, then select Products and Services.
- Select New, then select Service.
- In the Basic info section, enter the name, item type, and category of the item.
- In the Sales section, select In-kind donations in the Income account ▼ dropdown.
- In the Purchasing section, select I purchase this service from a vendor.
Note: You can add your product description or purchase cost as needed. - Select Create new.