Chart of Accounts in QuickBooks Online: Setup, Template, Sample List and Expense Categories

It is the index of every account QuickBooks can post a transaction to. Five parent categories sit behind it: assets, liabilities, equity, income and expenses. The first three build your balance sheet and the last two build your profit and loss. Every invoice, bill, deposit and bank feed transaction has to be assigned to one of these accounts.

That is why the list matters more than it looks like it should. Your financial statements are not a separate thing you produce at year end; they are this list, totaled. Group your costs into six vague expense accounts and your profit and loss will tell you almost nothing. Split them into ninety and you will spend the year fighting over which one a purchase belongs in. Most owner-managed US businesses land somewhere between thirty and sixty accounts, and accountants generally push toward fewer, not more.

Select Settings, the gear icon in the top right, then Chart of accounts under Your Company. Intuit also puts it in the left navigation, and the label depends on which view you are in: Transactions then Chart of accounts in accountant view, Bookkeeping then Chart of accounts in business view, and All apps then Accounting then Chart of accounts in the newer layout. All of them open the same list.

Intuit moves this menu around more often than most, so if a set of instructions you are following does not match your screen, the gear icon route is the one that has survived every redesign. In QuickBooks Desktop the list lives under Lists, then Chart of Accounts, and Ctrl+A opens it from anywhere in the file.

Every account needs two labels. The account type decides which financial statement it appears on and how QuickBooks treats it. The detail type is a narrower label inside that type, and it is what QuickBooks uses to shape reports and to suggest tax mappings. This is the table to keep open while you build the list.

Pick the account type deliberately, because it is the harder one to walk back. QuickBooks will let you edit an account's type later, but it warns you that every historical transaction moves with it, and some switches are blocked once an account has activity. Our guide to changing an account type in QuickBooks covers what happens to prior periods when you do.

Detail type is more forgiving. If you are not sure which one fits, choose the closest match and move on. It affects the label and the reporting hints, not the arithmetic, and it can be changed later without disturbing your history.

Here is a working example for a typical US service or product business. It uses numbers in the standard blocks accountants expect (1000s assets, 2000s liabilities, 3000s equity, 4000s income, 5000s cost of goods sold, 6000s operating expenses), which leaves gaps to add accounts later without renumbering everything.

Treat it as a starting point rather than a standard. A construction contractor will want cost of goods sold split by trade. A law firm needs a client trust liability account and will never touch inventory. A restaurant usually splits food cost from beverage cost because the margins are different and the split is the only way to see it. Add what your reports need to show, and leave out anything you cannot picture yourself looking at.

Two accounts on that list are worth knowing about before you meet them in a reconciliation. Undeposited Funds is where QuickBooks parks payments you have received but not yet grouped into a bank deposit, and it is the most common source of a balance that will not tie out; we cover it in the undeposited funds guide. Opening Balance Equity is where the offset goes when you enter a starting balance for an account, and it should end up at zero once your books are set up properly, which the opening balance equity guide explains.

Start from the list QuickBooks generated for you, then add, rename and deactivate until it matches how you want to read your numbers. To add one account:

1. Select Settings, then Chart of accounts.
2. Select New in the top right.
3. Choose the Account type from the dropdown.
4. Choose the Detail type, which filters to the options valid for that account type.
5. Enter the account name, and the account number if you have numbering turned on.
6. If it belongs under another account, tick the option to make it a sub-account and choose the parent.
7. Select Save and Close.

Do the renaming pass before you import a year of transactions, not after. Renaming an account is harmless at any time, but categorizing three hundred transactions into an account you later decide was the wrong idea means recategorizing three hundred transactions. Sub-accounts are the usual answer when you want detail without a longer list: keep one Utilities parent and put Electricity, Gas and Internet underneath it, and your profit and loss can be run either collapsed or expanded.

Account numbers are off by default. Go to Settings, then Account and settings, then the Advanced tab. Select Edit in the Chart of accounts section, turn on Enable account numbers, and turn on Show account numbers if you want them to appear in reports and on transactions. Select Save, then Done.

Once the setting is on, a Number column appears in the chart of accounts. Filling it in one account at a time is slow, so use the batch edit pencil above the Action column instead: it makes the whole list editable at once, and you can type every number and save in a single pass. Numbers can be up to twenty digits, which is far more than anyone needs, and QuickBooks sorts the list numerically as soon as they exist.

Numbering is optional and plenty of small businesses skip it. It earns its keep when an outside accountant works in the file, when you report into a parent company that uses a fixed scheme, or when you have enough accounts that alphabetical order stops being useful.

Open the chart of accounts, select the dropdown arrow next to New, then Import. Download the sample file first so your columns match what QuickBooks expects, fill it in, upload it as CSV, XLS or XLSX, map your columns to the QuickBooks fields, preview the result and confirm. The importer adds accounts; it does not delete the ones already there.

The columns that matter are Account Number, Account Name, Type and Detail Type, plus Currency if you have multicurrency turned on. Sub-accounts use a colon: put the parent on its own row, then write the child as Parent:Child on the row below. Get that syntax wrong and every account imports flat.

This is the fastest way to stand up a new client file with a firm-standard account list, and it is also how you carry a structure across from an old file. The full walkthrough, including the errors the importer throws and how to fix them, is in the guide to importing a chart of accounts into QuickBooks Online.

Run the Account List report. Go to Reports, search for Account List, then use the export icon above the report to send it to Excel or download it as a PDF. The export carries the account name, type, detail type and current balance, and it includes account numbers when you have numbering switched on.

Accountants use this two ways. As a review document it is the fastest read on whether a file is a mess, because duplicate accounts and stray detail types are obvious in one screen. As a migration file it becomes the import template for the next file, once you delete the balance column and reorder the headers to match the sample import file.

In QuickBooks Online, expense categories are simply the accounts with an account type of Expenses or Other expense. There is no separate category list. When QuickBooks asks you to categorize a bank transaction, it is asking which expense account to post it to, which is why the list you build here decides how detailed your profit and loss can be.

A default QuickBooks file usually arrives with something close to this set of expense accounts:

• Advertising and marketing
• Bank charges and fees
• Car and truck expenses
• Contract labor and professional fees
• Insurance
• Interest paid
• Legal and professional fees
• Meals
• Office supplies and software
• Other business expenses
• Rent and lease
• Repairs and maintenance
• Supplies
• Taxes and licenses
• Travel
• Utilities

One point of confusion worth clearing up: QuickBooks also has Categories under products and services, and those are a completely different feature for grouping the things you sell. They do not affect your profit and loss. If someone tells you to change a category and your numbers are wrong, they almost certainly mean the account. Our guide to categorizing transactions in QuickBooks covers the day to day side of that work.

No. QuickBooks Online makes accounts inactive rather than deleting them, and the button labeled Delete in the Action column is what does it. The account stops appearing in dropdowns, but its history stays in the file, so any report covering a period when the account had transactions still shows it.

That surprises people who deactivate an account expecting the balance sheet to get shorter. If you want the account gone from reports rather than just hidden, the route is to make it active again and merge it into the account you actually want to use, which moves the transactions across. Merging is done by editing the unwanted account and renaming it (and renumbering it, if you use numbers) to exactly match the target account, then confirming the merge prompt. It cannot be undone, so run and save the reports you might need first.

Simple Start, Essentials and Plus include 250 accounts in the chart of accounts. QuickBooks Online Advanced removes the cap. Sub-accounts count toward the 250, inactive accounts do not, and the chart of accounts has a filter for what counts toward the limit so you can see where you stand.

Most small businesses never come near it. The files that do are usually migrations from QuickBooks Desktop, where a fifteen year old account list has been accumulating without anyone tidying it, and departments or locations were built as separate accounts instead of classes. If you are close to the ceiling, deactivating dead accounts and rebuilding the departmental split with classes or locations is normally cheaper than upgrading the subscription.

Every transaction that arrives from a bank feed or an imported .qbo file lands in the For review tab with no account assigned. You pick one, or a bank rule picks one for you, and only then does it post to your books. So the quality of the account list is the ceiling on how fast an import can be cleared, and on how useful the result is.

Two practical consequences for anyone doing catch-up work. First, settle the account list before you import a year of history, because bank rules are written against account names and rewriting them halfway through is wasted time. Second, build the accounts your rules will need: if you want fuel separated from vehicle repairs, the two accounts have to exist before the rule can point at either. Our pages on importing bank statements into QuickBooks Online and catch-up bookkeeping from bank statements cover the import side of the same job.

If the transactions themselves are missing rather than miscategorized, converting the PDF statements is the step that fills the gap. Upload them at the top of this page, import the .qbo files oldest month first, and reconcile each month before moving to the next.