Understanding Classes in QuickBooks Online

Classes in QuickBooks Online let you tag transactions with a category that is separate from your chart of accounts. GrantLink can use a Class to find the expenses that belong to a grant.

What are Classes?

Classes are reporting tags that you apply to transactions in QuickBooks Online. Depending on your class tracking setting, you assign one Class to the whole transaction or one Class to each row. A Class can appear on transactions in any account. It isn't part of the chart of accounts, and it doesn't create a donor restriction, a self-balancing fund, or a record of which donor gave the money.

Nonprofits commonly use Classes to track:

• Grants or other funding sources
• Programs or services
• Departments
• Offices or sites

Plans and limits

Class tracking is available only in QuickBooks Online Plus and Advanced. Plus allows 40 active Classes and Locations combined, and Advanced has no limit. If you plan one Class for each grant on Plus, count your grants, programs, and Locations against that limit before you start.

Turning on class tracking

1. In QuickBooks Online, go to Settings > Account and settings > Advanced.
2. In the Categories section, turn on Track classes.
3. In Assign classes, choose One to entire transaction or One to each row in transaction.
4. To get a warning when a transaction has no Class, select Warn me when a transaction isn't assigned a class.
5. Select Save, then Done.

Creating a Class for a grant

1. In QuickBooks Online, go to Settings > All lists > Classes.
2. Select New and enter the grant name.
3. Save the Class.
4. In GrantLink, open the grant and link the Class on the grant's Expenses tab, as described below.

GrantLink can also create a Class for you while you set up a grant. It does so only if your organization allows Create or update QBO grant entities in Settings > QuickBooks > Permissions. Adding a grant doesn't create a Class by itself.

How GrantLink uses Classes

When a grant's expenses are tagged with a Class, set up the link in GrantLink this way:

1. Add the grant in GrantLink.
2. On the grant's Details page, find the QuickBooks panel and select Set up or Manage.
3. On the Expenses tab, select the Class.
4. GrantLink then allocates eligible synced expense lines that carry that Class to the grant automatically.

The link controls matching in GrantLink only. It doesn't add the Class to the transaction in QuickBooks Online. GrantLink can update a transaction's Class in QuickBooks only if your organization allows that change in Settings > QuickBooks > Permissions. GrantLink is making QuickBooks changes available in stages, so this update may not be available yet.

Class hierarchy

QuickBooks Online supports sub-classes. To create one, select Is sub-class and choose the parent Class. Sub-classes can group related grants, as in this example.

Foundation Grants (Parent Class)
├── Ford Foundation 2024
├── Ford Foundation 2025
└── Kellogg Foundation 2024

Government Grants (Parent Class)
├── HHS Grant 2024
└── DOE Grant 2024

The hierarchy can organize QuickBooks Online reports. GrantLink doesn't group grants by parent Class, and each grant uses its own linked records. If a grant uses several sub-classes, link each one that belongs to the grant.

Classes and budgets

On Plus and Advanced, you can create a profit and loss budget for a fiscal year and subdivide it by Class. You can then compare the budget with actual amounts in the Budgets vs. Actuals report. Check Intuit's budget instructions for the current steps.

Class reports don't decide revenue recognition, donor restrictions, releases from restriction, or compliance. Unconditional contributions, conditional contributions, and exchange transactions each need their own accounting analysis under a recognition policy that your CPA approves.

Best practices

1. Name each Class to match the grant name, so staff can find it easily.
2. Turn on the warning for transactions without a Class.
3. Check regularly for transactions that are missing a Class.
4. When a grant ends, make its Class inactive instead of deleting it.

Troubleshooting

A Class doesn't appear in GrantLink

• Make sure the Class is active in QuickBooks Online.
• Run a manual sync in GrantLink with Sync now.
• In Settings > QuickBooks > Mapping, open Advanced and check whether the Class is hidden under Class visibility in GrantLink.

Transactions don't allocate automatically

• Make sure the Class is selected on the grant's Expenses tab.
• Check that the Class is on the transaction or on the row, as your QuickBooks Online setting requires.
• Confirm that the transaction date falls within the grant period.
• Check Settings > QuickBooks > Sync for sync errors.

How GrantLink supports this today

You can add a grant manually or from a PDF of the award letter, agreement, or RFP. Then use the grant's Expenses and Money received tabs to link QuickBooks records. The Expenses links drive automatic allocation of eligible expense lines. Money received links match income or revenue records, so a matched line isn't always a cash receipt.

To create a report, select Draft report with Assistant on the grant's Reporting > Reports page, or open Chats > New chat. Finished reports appear on the grant's Reports page.

GrantLink doesn't change QuickBooks Online unless your organization allows that change in Settings > QuickBooks > Permissions. Grant links are set on each grant, and the shared settings in Settings > QuickBooks > Mapping don't relink existing grants.

Sources

• Intuit: Turn on class tracking: supported plans, class settings, and transaction or row assignment.
• Intuit: Get started with class tracking: what Classes are for and which plans include them.
• Intuit: Learn about usage limits: the combined Class and Location limit on each plan.
• Intuit: Create budgets: fiscal-year budgets and subdivision by Class or Location.