Choosing the Right QuickBooks Software for Your Organization

Written by Gregg Bossen | Nov 10, 2023 7:49:04 PM

Eighty-five percent of all small businesses, including nonprofits, in the U.S. use QuickBooks as their accounting software. This market share has been fairly consistent over the last 10 years. What has not been consistent is the specific QuickBooks product nonprofits decide to use.

I teach a number of courses on QuickBooks aimed at nonprofit professionals. And over the last five years, I've seen a dramatic increase in the number of students who choose to use QuickBooks Online instead of QuickBooks Premier or QuickBooks for Mac. However, either solution might be the best fit for you.

Desktop versions of QuickBooks and QuickBooks Online are both good choices and have multiple versions to choose from. Here are the five solutions available through TechSoup:

Update, October 2024: Intuit has ended support of QuickBooks Premier Editions 2021 after May 2024.

Organizations continuing to access and use Premier Editions 2021 can expect the product to continue to function without Intuit support, but they will not have access to live technical support or other services like QuickBooks Desktop Payroll, Desktop Payments, Online Backup, and Online Banking. Organizations will not receive critical security updates protecting their data.

So there are many QuickBooks solutions to choose from. I'd like to take a moment to review some key points that might help you in your decision-making process. If you scroll down, I've even included a handy feature comparison chart for quick reference.

Important Things to Know About QuickBooks Accounting Software

There's much to keep in mind when deciding which version of QuickBooks is best for you, and separating fact from fiction can be tough. But keep the following in mind:

QuickBooks is a great accounting solution for your nonprofit. No choice is a bad one. If you change your mind, switching is doable and fairly seamless as long as your files aren't too large.
You get anywhere access with QuickBooks Online. The main advantage of QuickBooks Online remains the ability to access files from anywhere.
QuickBooks Online has improved in both functionality and reporting over the last five years. While it used to be true that the desktop version had much better reporting functionality, this is no longer the case.
Some accountants prefer desktop versions of QuickBooks. But there are also accountants who prefer Online. While your accountant's preference should be considered, do not always assume that they know what's best for you and your organization. Some work in both and know both well. But most simply know what they like to use. Having said that, if you decide to pick a version your accountant doesn't use, it may be time to find an accountant who does.
QuickBooks Online is the future. Cloud-based software is where technology is moving. Desktop versions of QuickBooks will be around for the foreseeable future, but 10 years from now, most nonprofits will be likely be using QuickBooks Online.

Lastly, Intuit also offers QuickBooks Online Advanced. When Online Advanced was introduced, Intuit placed certain list limits on QuickBooks Online Plus. The chart of accounts in QuickBooks Online Plus is now limited to 250 accounts and 40 classes (used for program tracking). While those exceeding these limits may upgrade to QuickBooks Online Advanced, the honest truth is that anyone with more than 250 accounts (or 40 classes) is most likely overusing these lists and needs to purge them anyway.

QuickBooks Feature Comparison for Nonprofits

Each version of QuickBooks has a different set of features, and it can be tricky navigating through all the details. This chart will give you a better picture of what's available.

QuickBooks Feature	Premier Desktop	QuickBooks for Mac	QuickBooks Online Plus	QuickBooks Online Advanced
GENERAL
Anywhere Access			●	●
Restricted User Access	yes	yes	very limited	yes
Report-Only Access	yes	yes	yes	yes
Number of Company Files Supported (per Account)	unlimited	unlimited	1	1
LIST LIMITS
Number of Accounts Allowed	10,000	10,000	250	unlimited
Number of Classes (Programs) Allowed	10,000	10,000	40	unlimited
Number of Donors or Members Allowed	14,500	14,500	unlimited	unlimited
REVENUE
Tracks Pledges, Restricted Grants, and Inventory Sales	●	●	●	●
Batch Membership Invoicing	●	●		●
DONOR DATABASE FUNCTIONALITY
Generates Donor Ask Letters and Donor Thank-You Letters	●	●	need app	need app
Customized Fields for Donors	●	●		●
Emails Donors	●	●	●	●
Donor Reporting (LYBUNT, etc.)	●	●	●	●
EXPENSES
Tracks Accounts Payable, Purchase Orders, and Credit Cards	●	●	●	●
Downloading from Bank Card or Credit Card	●	●	●	●
Downloading Rules That Remember Correct Account and Name	●	●	●	●
Downloading Rules That Remember Correct Class (Program)	●		●	●
Downloading Rules That Remember Split Between Programs			●	●
Automatic Downloading Is Free			●	●
REPORTING AND OTHER
Budgeting by Account and Program or Grant	●	●	●	●
Financial Statements for Board	●	●	●	●
Profit and Loss by Program or Grant	●	●	●	●

The Bottom Line: Choosing Desktop vs. Online

As the chart above demonstrates, both QuickBooks desktop and QuickBooks Online are good solutions and share much of the same functionality. But remember, those who choose the desktop version may eventually need to make the switch to QuickBooks Online, as cloud-based solutions become the industry standard for all IT products. In the meantime, however, the desktop version remains a great choice for certain organizations.

View full post