QuickBooks Desktop for Non Profits
QuickBooks Desktop for Non Profits
It’s no secret that millions of small business owners across the globe use Intuit applications such as QuickBooks Nonprofit Desktop or QuickBooks Online to manage their finances. With its minimal learning curve, good reporting options, and the choice of either a desktop or online application, QuickBooks can be a real asset for just about any type of business.
But what about nonprofit organizations? Are QuickBooks applications a good choice for them as well?
That’s a difficult question to answer. For smaller nonprofits, both QuickBooks Desktop and QuickBooks Online can provide good financial management options. However, for larger nonprofits that manage multiple funds, programs, or projects, or receive grant funding, there are nonprofit accounting software options available that offer true fund accounting, which may be a better fit.
Why nonprofit software is different
Like any business, a nonprofit needs to perform standard bookkeeping tasks such as handling multiple bank accounts and bank reconciliations, tracking organizational expenses, and paying vendors on a timely basis. But nonprofits also need to deposit donations and grant funds, track both monetary and in-kind donations, provide donors with tax receipts and thank you letters, and in many cases manage volunteers.
Here are just a few of the ways that for-profit and nonprofit organizations differ.
Taxes – While for-profit businesses are required to pay taxes on their income, nonprofit organization is exempt from paying taxes on donations or grants. However, like a for-profit business, a nonprofit is still responsible for all federal, state, and local taxes, as well as Social Security and Medicare taxes.
Profit management – A for-profit business can put profits earned into retained earnings for future use, distribute earnings to shareholders, or a combination of the two. Any profit earned by a non-profit must be reinvested back into the organization’s work.
Accountability – While a for-profit business is typically accountable to the owners or shareholders, a nonprofit is accountable to its board members as well as anyone that provides funding to the organization, whether it’s a $5 million grant or a $50 donation.
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