“Also, technically this is an employee benefit, so I’m not sure how that factors in. Could it be recorded under an employee benefit expense like healthcare?”

This is the Most Important piece of the puzzle, actually.

“My thought was to create an Other Expense account called “lost revenue”, where should I go […]

Resolution for 'benefit rule issue: 'I work for a school that gives staff free tuition for their children. How can I record the lost income that would have been received if the spot went to a paying child?' available: Yes.

The benefit rule issue or error code is a known issue in Quickbooks Online (QBO) and/or Quickbooks. Support for this issue is available either by self-service or paid support options. Experts are available to resolve your Quickbooks issue to ensure minimal downtime and continue running your business. First try to resolve the benefit rule issue yourself by looking for a resolution described in the article. If it is a complex benefit rule issue or you are unable to solve the issue, you may contact us by clicking here or by using other benefit rule support options.

For more information about resolving issues related to benefit rule in Quickbooks/QBO or to get support for the issue 'I work for a school that gives staff free tuition for their children. How can I record the lost income that would have been received if the spot went to a paying child?', click the link below: