Nonprofit Chart of Accounts Template
TLDR
A general-purpose chart of accounts does not work for nonprofits. Fund accounting requires tracking revenue and expenses by restriction, by program, and by grant, and your chart of accounts is the foundation that makes all of that possible. This template gives you a numbered account structure aligned with FASB ASC 958 and ready for fund accounting software.
Form 990 Part IX requires functional expense allocation across three categories: program services, management/general, and fundraising. Under FASB ASU 2016-14, this allocation must be presented in the Statement of Functional Expenses. QuickBooks Online has no native Statement of Functional Expenses report. That means if your chart of accounts does not encode the functional structure from day one, you will end up building the allocation manually in a spreadsheet every year before you can file your 990. This template encodes that structure at the account level, so the report is a query rather than a reconstruction.
How This Template Is Organized
A nonprofit chart of accounts follows the same five major categories as any accounting system (assets, liabilities, net assets, revenue, expenses), but with structural differences that support fund accounting.
The key difference: nonprofits need to track the same revenue and expense accounts across multiple funds, programs, and restriction levels. Your chart of accounts must be built to support this dimensionality from the start. Retrofitting a generic chart of accounts to handle fund reporting means reclassifying every historical transaction, rebuilding reports from scratch, and explaining the inconsistency to your auditor.
Numbering convention used in this template:
- 1000-1999: Assets
- 2000-2999: Liabilities
- 3000-3999: Net assets
- 4000-4999: Revenue
- 5000-5999: Cost of goods sold (if applicable)
- 6000-6999: Program expenses
- 7000-7999: Management and general expenses
- 8000-8999: Fundraising expenses
This numbering system separates expenses by functional category at the account level, which makes Form 990 functional expense reporting straightforward. Some nonprofits prefer a flat expense range (6000-6999 for all expenses) and use classes or departments to track the functional allocation. Either approach works if your accounting software supports class tracking. The template below uses the separated approach because it works regardless of software capability.
Adapt the numbering and specific accounts to your organization. This template covers a typical 501(c)(3) with program services, grants, and individual donations. If your nonprofit has unusual revenue sources (earned income, membership dues, government contracts), add accounts as needed.
Asset Accounts (1000-1999)
Current assets:
| Account # | Account Name | Description |
|---|---|---|
| 1000 | Operating Checking | Primary operating bank account |
| 1010 | Payroll Checking | Dedicated payroll bank account (if separate) |
| 1020 | Savings / Money Market | Operating reserves |
| 1030 | Petty Cash | On-hand cash for small purchases |
| 1100 | Grants Receivable | Grants approved but not yet received |
| 1110 | Pledges Receivable | Donor pledges committed but not yet collected |
| 1120 | Allowance for Uncollectible Pledges | Contra account for pledges estimated to be uncollectible |
| 1130 | Accounts Receivable - Other | Fee-for-service or earned revenue receivables |
| 1200 | Prepaid Expenses | Insurance, rent, subscriptions paid in advance |
| 1210 | Prepaid Insurance | Annual insurance premiums paid in advance |
| 1250 | Inventory | Program supplies, publications for sale, etc. |
Restricted cash (keep separate from operating):
| Account # | Account Name | Description |
|---|---|---|
| 1300 | Restricted Cash - Grant Funds | Bank account or sub-account for grant funds requiring separate tracking |
| 1310 | Restricted Cash - Endowment | Endowment principal held in investment accounts |
Fixed assets:
| Account # | Account Name | Description |
|---|---|---|
| 1500 | Furniture and Equipment | Office furniture, computers, program equipment |
| 1510 | Accumulated Depreciation - Furniture & Equip | Contra account |
| 1520 | Leasehold Improvements | Build-outs on leased office space |
| 1530 | Accumulated Depreciation - Leasehold | Contra account |
| 1540 | Vehicles | Organization-owned vehicles |
| 1550 | Accumulated Depreciation - Vehicles | Contra account |
Investments:
| Account # | Account Name | Description |
|---|---|---|
| 1600 | Investments - Unrestricted | Board-designated or general investment portfolio |
| 1610 | Investments - Restricted | Donor-restricted investment funds |
| 1620 | Unrealized Gain/Loss on Investments | Mark-to-market adjustment |
Set your capitalization threshold (the minimum cost to record as a fixed asset rather than an expense). Common thresholds for small nonprofits: $1,000-$5,000. Items below the threshold are expensed immediately. Document this threshold in your accounting policies.
Nonprofit Chart of Accounts Template
A chart of accounts template structured for fund accounting, covering asset, liability, net asset, revenue, and expense accounts aligned with FASB ASC 958 requirements.
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- functional expense allocation
- The process of assigning each expense to one of three categories required by FASB ASU 2016-14 and Form 990 Part IX: program services, management and general, or fundraising. Shared costs (such as the executive director's salary or building rent) must be allocated across categories using a documented, consistent methodology such as time studies or square footage ratios.
DEFINITION
- Statement of Functional Expenses
- A financial statement required for nonprofits under FASB ASC 958 and FASB ASU 2016-14 that presents expenses by both natural classification (salaries, rent, supplies) and functional classification (program, management/general, fundraising). It maps directly to Form 990 Part IX. QuickBooks Online does not produce this report natively, which is one reason nonprofits with multiple restricted funds or grant reporting requirements typically outgrow it.
DEFINITION
Q&A
What does the Nonprofit Chart of Accounts Template provide?
The template provides a numbered account structure aligned with FASB ASC 958 requirements, covering asset, liability, net asset, revenue, and expense accounts organized for fund accounting. It enables tracking revenue and expenses by restriction, by program, and by grant, which a general-purpose chart of accounts cannot support.
Q&A
How should a nonprofit chart of accounts handle functional expenses?
The chart of accounts should encode functional expense categories (program services, management/general, fundraising) at the account level or via a parallel classification system. This mirrors Form 990 Part IX requirements and FASB ASU 2016-14 standards. QuickBooks Online has no native Statement of Functional Expenses report, so the chart of accounts structure must compensate by making the functional allocation explicit from the first transaction.