Hi, Sarahann:

Thanks for the reply. I'm still not 100% clear about what's happening here, but I'm getting there...

I looked at the Product/Service list (what I'm used to calling Items in QuickBooks Enterprise). When I set them up, I did not specify a class on purpose. Under Donations > Restricted > Individual, the person may donate for one cause that we've given a class (say, "Wildfire Relief"), then donate a few months later for a second case (a class called "WIldfire Relief"). We have similar Items under Donations > Restricted for corporations, other foundations, and so on. We have a duplicate structure for Donations > Discretionary; that is, funds received from people that we can spend as we see fit.

We set it up this way for two reasons: to be able to see where our donations are coming from by type of donor and to segregate funds dedicated to a specific purpose (that is, "class") from funds we can spend in a general way (these do not have a class). I thought using classes would be a good idea because we can run a P&L (called a Statement of Activity for a non-profit) by class and see how much in donations we've received for a specific cause and how much we've spent on that cause. 

The Product/Services list mimics the chart of accounts (COA); that is, the COA is set up with the same income accounts as the Product/Services list. For example, both use the same parent/child structure; for example, Donations > Restricted > Individual.

It wouldn't make sense to swell the Chart of Accounts by creating an income account for every cause (Donations > Restricted > Individual > Wiildfire Relief. We wouldn't need to use classes in that case and over time, we'd end up with a huge COA. 

Here's what I'm trying to do. We have one checking account with the bank. At the same time, it's critical that I keep discretionary funds separated from restricted funds. I don't need to physically have two bank accounts. I just need to know, at any time, two important things: (1) how much money is in discretionary and restricted, and (2) how much money have we received and spent for a specific restricted cause.

To accomplish this, I created two sub-accounts under our checking account: Discretionary and Restricted. When a donation comes in, I code it under one of the two sub-accounts: OnPoint Checking > Restricted or OnPoint Checking > Discretionary. If it's restricted, I also assigned a class corresponding to the cause specified by the donor (for example, "Wildfire Relief.") I also set up a custom Statement of Activity by class that shows me how much income and expense we have by class.

What's critical is to make sure that every transaction in the OnPoint Checking > Restricted sub account has a class associated with it. It's also critical that no transaction in OnPoint Checking > Discretionary does NOT have a class (classes are ONLY for restricted funds that are donated for a specific purpose, or class.) All I want to do is run a balance sheet (Statement of Financial Position), click the OnPoint Checking > Restricted or OnPoint Checking > Discretionary, and see a list of transactions in date order and make sure there is or is not a class. I did that, but that's where I ran into a problem: The class does not show up. 

Why isn't is showing up? It seems that it's related to some (or all) of these quirky ways classes work in QBO: (1) The income or expense account doesn't have a class associated with it; (2) the item doesn't have a class associated with it, or (3) I'm using classes by line item in a transaction instead of classing the entire transaction.

With this explanation, and stating what I'm trying to accomplish, can you help me understand what I'm doing wrong? Should I abandon classes and instead use tags? Is there another way to set this up?

I'm sorry this is so long, but I'm hoping this will help you provide some advice to me. Thank you!

Steven