Coronavirus Disease 2019 (COVID-19) Resources

ECONOMIC RELIEF FOR NONPROFITS - CARES ACT

3/27/2020 - the House unanimously passed and President signed into law the Coronavirus Aid, Relief, and Economic Security (CARES) Act, a $2 trillion economic stimulus package intended to provide immediate relief for individuals, nonprofits, businesses, and state and local governments. Several provisions of the CARES Act are of particular importance to nonprofits, including: 1. The availability of forgivable small business loans to nonprofits with 500 or fewer employees. 2. Unemployment relief for workers and (partially) for many nonprofits; 3. A (limited) universal charitable deduction for 2020; and 4. A variety of appropriations that will help many communities served by nonprofits.

6/03/2020 - Paycheck Protection Flexilibilty Act of 2020 Passed. Congress voted to allocate an additional $480 billion in relief funds for small businesses and nonprofits.

12/21/2020 - Congress approved the Consolidated Appropriations Act of 2021, a $900 billion COVID-19 Package (includes Important Relief for Nonprofits). The U.S. House of Representatives and U.S. Senate passed the $900 billion COVID-19 relief package as part of an omnibus federal spending bill. The hard work that your organizations have been doing and the difficult times that you’ve faced were recognized in some major elements of the bill. Thank you to all that joined with NAO and nonprofits across the country to advocate for this important relief for charitable nonprofits. 

What's in the New COVID Relief Law for Nonprofits - National Council of Nonprofits

PAYCHECK PROTECTION PROGRAM LOAN (PPP)

The Paycheck Protection Program (PPP) provides loans to help businesses and nonprofits keep their workforce employed during the Coronavirus (COVID-19) crisis. The loans can be forgiven if borrowers maintain their payrolls during the crisis or restore their payrolls afterward. Eligibility iincludes small entities, that together with their affiliates (if applicable), have 500 or fewer employees—including nonprofits, veterans organizations, tribal concerns, self-employed individuals, sole proprietorships, and independent contractors. PPP Loans can be used to help fund payroll costs, including benefits. Funds can also be used to pay for mortgage interest, rent, utilities, worker protection costs related to COVID-19, uninsured property damage costs caused by looting or vandalism during 2020, and certain supplier costs and expenses for operations.

NAO Paycheck Protection Program (PPP) Fact Sheet - NAO (1/20/2021)

Paycheck Protection Program - SBA Website
Paycheck Protection Program Loan Forgiveness - SBA
SBA Guidance on Accessing Capital for Minority, Underserved, Veteran and Women-Owned Business Concerns - SBA  (1/6/2021)

PPP First Draw Loans - targeted towards businesses and nonprofits who haven’t yet received any PPP funding, particularly those owned by women and minorities, as well as nonprofits and cultural venues. Eligibility has been expanded to include “destination marketing organizations”, chambers of commerce and other Sec. 501(c) business leagues. These organizations must have 300 or fewer employees and loans are subject to limits on lobbying activity.

• First Draw PPP Loans - SBA
• How to Calculate First Draw PPP Loan Amounts - SBA (1/17/21)
• Top Line Overview of First Draw  (1/08/2021)
• Interim Final Rule as Amended by Economic Aid Act  - SBA (1/6/2021)
• First Borrower Application Form (1/08/2021 - apply through eligible lender: See SBA Lender Match)

PPP Second Draw Loans - Second draw loans are available to those who have been hit hardest. While qualifying circumstances remain unchanged for first-time applicants, a borrower is generally eligible for a Second Draw PPP Loan if the borrower previously: received a First Draw PPP Loan and will or has used the full amount only for authorized uses; has no more than 300 employees; and can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020.

• Second Draw PPP Loans - SBA
• How to Calculate Second Draw Revenue Reduction & Maximum Loan Amounts - SBA (1/19/2021)
• Top Line Overview of Second Draw (1/08/2021)
• Interim Final Rule on Second Draw Loans - SBA (1/6/2021)
• Second Borrower Application Form (1/08/2021 - apply through eligible lender: See SBA Lender Match)

PPP Loan Forgiveness

• PPP Borrower Resubmissions of Loan Forgiveness Applications Using Form 3508S - SBA (1/15/21)
  Form 3508S may be used by borrowers that received a PPP loan of $150,000 or less.
• Repeal of EIDL Advance Deduction Requirement - SBA Procedural Notice (1/08/2021)

ECONOMIC INJURY DISASTER LOAN (EIDL)

In response to the Coronavirus (COVID-19) pandemic, small business owners in all U.S. states, Washington D.C., and territories are eligible to apply for an Economic Injury Disaster Loan that provides economic support to small businesses to help overcome the temporary loss of revenue they are experiencing as a result of the COVID-19 pandemic. This program is for any small business with less than 500 employees (including sole proprietorships, independent contractors and self-employed persons), private non-profit organization or 501(c)(19) veterans organizations affected by COVID-19. The loan program is a 30 year fixed at 2.75% interest rate and does not offer forgiveness as the PPP loan does. 

• COVID-19 Economic Injury Disaster Loans - SBA 
• COVID-19 Economic Injury Disaster Loan Application - SBA
• COVID-19 Funding Resources – Oregon Small Business Development Center
• Oregon Small Business Development Center Network - SBDC

SHUTTERED VENUE OPERATORS GRANT

The Shuttered Venue Operators (SVO) Grant program was established by The Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act, signed into law on December 27, 2020. The program includes $15 billion in grants to shuttered venues, to be administered by the Small Business Administration’s Office of Disaster Assistance. An applicant may have received a PPP forgivable loan in 2020, but must choose whether to receive an SOS grant or a PPP loan in 2021.

To be eligible to receive a grant, an entity (to include nonprofits) or individual must be a: live venue operator or promoter, theatrical producer, live performing arts organization operator, relevant museum operators, motion picture theatre operator, or talent representative. Eligible applicants may qualify for SVO Grants equal to 45% of their gross earned revenue, with the maximum amount available for a single grant award of $10 million. $2 billion is reserved for eligible applications with up to 50 full-time employees.

•  Shuttered Venue Operators Grant - SBA
•  New SBA Grant Program for Shuttered Venue Operators - National Law Review

Federal Grant Support Services

• Single Audit Service Providers: Go to NAO Principles & Practices - Financial Oversight to see providers that offer Single Audit services for nonprofits that have received federal grants. They are in NAO's network of business verified affiliate members.

TAX LAW CHANGES

Expanded tax benefits help individuals and businesses give to charity in 2020 & 2021 - IRS Year-end Reminder

• Nonitemizer charitable deduction extended to $300/$600 through 2021
• Itemizer deduction limit raised to allow cash donations up to 100% of income (see below)
• Corporate donations limit raised to 25% of income

Suspension of Charitable Contribution Limitations for 2020 & 2021: Typically, tax law limits charitable deductions to 60% of adjusted gross income (AGI). There is a temporary suspension of the limits on deductible charitable contributions under the CARES Act. For a contribution to qualify, it must be a cash contribution made to a qualifying organization during the 2020 and extended for the 2021 calendar year. Donor Advised Funds and Private Foundations are not qualifying organizations under this rule.

Employee Retention Tax Credit: The Taxpayer Certainty and Disaster Tax Relief Act of 2020, enacted December 27, 2020, amended and extended the employee retention credit (and the availability of certain advance payments of the tax credits) under section 2301 of the CARES Act. Employers carrying on a trade or business and tax exempt organizations who experience full or partial suspension of the operation of their business in any calendar quarter due to orders from a governmental authority limiting commerce, travel, or group meetings because of COVID-19 will be eligible for a payroll tax credit. 

• Employee Retention Tax Credit Extended through July 1, 2021
• Changes to the Employee Retention Credit - Clark Nuber
• Employee Retention Tax Credit Updates - Rules and Administration - JD Supra (1/12/21)
• Tax credit raised from 50% to 70% of qualified wages in 2021
• Retroactive access for qualifying wages in 2020
• 2020: 50% of up to $10,000 in wages/year per employee; full/partial suspension or 50% gross receipts decline
• 2021: 70% of up to $10,000 in wages/quarter per employee; full/partial suspension or 20% gross receipts decline
• May access both Employee Retention Tax Credit and Paycheck Protection Program forgivable loan as long as both are not used for the same wages

Payment of Employer Payroll Taxes Postponed: Employers will be allowed to delay payment of a portion of applicable payroll taxes without penalty or interest, except in certain circumstances, for payroll taxes due beginning on the date of the bill’s enactment and ending before January 1, 2021, provided 50% of the amounts deferred is paid before December 31, 2021 and the balance is paid before December 31, 2022. Employers who have indebtedness forgiven under the SBA Payroll Protection Loan program are not eligible for payroll tax deferral under this provision.

• COVID-19 for Nonprofits: Select Federal Incentives, Tax Changes, and Related Matters – Miller Nash Graham & Dunn
• US Federal Tax Law Changes in Response to Coronavirus – The National Law Review
• COVID-19 Tax Resource Center – Tax Foundation