Get 50% OFF QuickBooks for 3 months*

Buy now
cancel
Showing results for 
Search instead for 
Did you mean: 
Announcements
Work smarter and get more done with advanced tools that save you time. Discover QuickBooks Online Advanced.
Lesa4Thunder
Level 1

Donations not recorded as revenue

Hello,

Our non-profit incurred some legal fees and a donor wrote us a check to cover the fees.  I am expensing the legal fees out of a Legal Fee expense account. How do I record the donation without it being counted as revenue or income?  Of course, the donor wants tax credit for the donation. Thank you.

Lesa

Solved
Best answer October 31, 2023

Best Answers
ZackE
Moderator

Donations not recorded as revenue

Thanks for getting in touch with the Community, Lesa4Thunder. I appreciate your detailed information.

 

To track funds you've received through donations, you'll want to create a revenue account for them if you haven't yet.

 

Here's how:
 

  1. In the left navigation bar, go to Transactions, then Chart of accounts.
  2. Click New and enter the necessary information for your account. Make sure to choose Non-Profit Income as its detail type.
  3. You can title this account "Fund donations.".
  4. Be sure to save it when you're finished.

 

Next, you'll need to create a fund donation item:
 

  1. Create a non-inventory item.
  2. You can call the item "Fund donations.".
  3. Make sure to use your revenue account you set up previously.

 

After creating the item, you can add your donor as a customer and track their donation.

 

If you have any further questions about recording donations, I'd recommend working with an accounting professional. If you're in need of one, there's an awesome tool on our website called Find a ProAdvisor. All ProAdvisors listed there are QuickBooks-certified and able to provide helpful insights for driving your business's success.

 

I'll be here to help if there's any additional questions. Have an awesome Tuesday!

View solution in original post

Rainflurry
Level 15

Donations not recorded as revenue

@Lesa4Thunder 

 

The donation is considered revenue.  The legal fee expense will offset the revenue so there is no income.  

View solution in original post

2 Comments 2
ZackE
Moderator

Donations not recorded as revenue

Thanks for getting in touch with the Community, Lesa4Thunder. I appreciate your detailed information.

 

To track funds you've received through donations, you'll want to create a revenue account for them if you haven't yet.

 

Here's how:
 

  1. In the left navigation bar, go to Transactions, then Chart of accounts.
  2. Click New and enter the necessary information for your account. Make sure to choose Non-Profit Income as its detail type.
  3. You can title this account "Fund donations.".
  4. Be sure to save it when you're finished.

 

Next, you'll need to create a fund donation item:
 

  1. Create a non-inventory item.
  2. You can call the item "Fund donations.".
  3. Make sure to use your revenue account you set up previously.

 

After creating the item, you can add your donor as a customer and track their donation.

 

If you have any further questions about recording donations, I'd recommend working with an accounting professional. If you're in need of one, there's an awesome tool on our website called Find a ProAdvisor. All ProAdvisors listed there are QuickBooks-certified and able to provide helpful insights for driving your business's success.

 

I'll be here to help if there's any additional questions. Have an awesome Tuesday!

Rainflurry
Level 15

Donations not recorded as revenue

@Lesa4Thunder 

 

The donation is considered revenue.  The legal fee expense will offset the revenue so there is no income.  

Need QuickBooks guidance?
Log in to access expert advice and community support instantly.

Need to get in touch?

Contact us