10 Nonprofit Marketing Experts’ Best Fundraising Strategies
March 28, 2020Jim Eskin Explains, “The 4Rs of COVID-19”
March 28, 2020CARES Act for Nonprofits – What’s in the Bill For Charities?
CARES Act for Nonprofits – Friday, March 27, the Congress passed and the President signed into law the Coronavirus Aid, Relief, and Economic Security (CARES) Act, a $2 trillion economic stimulus package legislated to provide immediate relief for nonprofits, businesses, individuals and state and local governments.
CARES Act for Nonprofits – What’s in the Legislation For Charities?
The CARES Act provides significant funding for 501(c)3 organizations. Here’s an overview of benefits:
Paycheck Protection Program Loans (emergency SBA 7(a) loans): Creates an emergency loan program providing loans of up to $10 million for eligible nonprofits and small businesses, permitting them to cover costs of payroll, operations, and debt service, and provides that the loans will be forgiven in whole or in part under certain circumstances. Section 1102.
- Date Eligibility: Available to entities that existed on February 15, 2020 and had paid employees or paid independent contractors.
- Charitable Eligibility: Available for nonprofits with 500 or fewer employees, counting each individual – full time or part time (not including Full Time Equivalents [FTEs]). The law does not disqualify nonprofits that are eligible for payments under Title XIX of the Social Security Act (Medicaid), but does require that employees of affiliated nonprofits may be counted toward the 500 employee cap, depending on the degree of control of the parent organization.
- Personal Guarantee: No personal guarantee or collateral will be required in securing a loan.
- Loan Amount: The lesser of $10 million or 2.5 times the average total monthly payroll (including benefits) costs from the one-year period prior to the date of application.
- Loan Use: Loan funds can be used to make payroll and associated costs, including health and retirement benefits, facilities costs, and debt service.
- Loan Liability: Employers that maintain employment for the eight weeks after the origination of the loan, or rehire employees by June 30, would be eligible to have their loans forgiven, essentially turning the loan into a grant. Section 1106.
SUBSCRIBE ABOVE FOR SMALL BUSINESS ADMINISTRATION CARES ACT APPLICATION LINK (TO BE POSTED ONLINE ASAP)
Economic Injury Disaster Loans (EIDL): Creates emergency grants for eligible nonprofits and other applicants with 500 or fewer employees enabling them to receive checks for $10,000 within three days. Section 1110.
Self-Funded Nonprofits and Unemployment: Only reimburses self-funded nonprofits for half of the costs of benefits provided to their laid-off employees. Some charitable nonprofits pay state unemployment taxes (SUTA) like other businesses. These organizations pay quarterly taxes based on their “experience rating,” a formula based on the recent history of unemployment claims by their former employees. Charitable nonprofits have the option of electing of self-insuring rather than paying SUTA. Nonprofits that elect to take this option are required to reimburse their state unemployment insurance trust funds for the amount of benefits their terminated or laid off employees claim. Section 2103.
Charitable Giving Incentive: Creates a new above-the-line deduction (universal or non-itemizer deduction that applies to all taxpayers) for total charitable contributions of up to $300. The incentive applies to cash contributions made in 2020 and can be claimed on tax forms next year. Section 2204. The law also lifts the existing cap on annual contributions for those who itemize, raising it from 60 percent of adjusted gross income to 100 percent. For corporations, the law raises the annual limit from 10 percent to 25 percent. Food donations from corporations would be available to 25 percent, up from the current 15 percent cap. Section 2205.
Employee Retention Payroll Tax Credit: Creates a refundable payroll tax credit of up to $5,000 for each employee on the payroll when certain conditions are met. The entity had to be an ongoing concern at the beginning of 2020, experienced a whole or partial shutdown, and had seen a drop in revenue of at least 50 percent in the first quarter compared to the first quarter of 2019. The availability of the credit would continue each quarter until the organization’s revenue exceeds 80 percent of the same quarter in 2019. For tax-exempt organizations, the entity’s whole operations must be taken into account when determining eligibility. Notably, employers receiving Paycheck Protection Program loans would not be eligible for these credits. Section 2301.
Delayed Payment of Payroll Taxes: Allows employers to delay payment of the employer portion payroll taxes in 2020; payable in equal halves at the end of 2021 and 2022. Section 2301.
Economic Stabilization Fund: Creates a loan and loan guarantee program for industries like airlines to keep them solvent through the crisis. It sets aside $454 billion for “eligible business” which is defined as “a United States business that has not otherwise received economic relief in the form of loans or loan guarantees provided under” the legislation. It is expected, but unclear, whether charitable nonprofits qualify under that definition for stabilization loans. Mid-sized nonprofits and businesses that have between 500 and 10,000 employees are expressly eligible for loans under this provision. Although there is no loan forgiveness provision in this section, the mid-size business loans would be charged an interest rate of no higher than two percent and would not accrue interest or require repayments for the first six months. Nonprofits accepting the mid-size business loans must retain at least 90 percent of their staff at full compensation and benefits until September 30. Section 4003.
VISIT HERE to download entire bill, H.R. 758, from Congress.gov (854 pages).
SUBSCRIBE AT TOP OF THIS PAGE FOR SMALL BUSINESS ADMINISTRATION CARES ACT APPLICATION LINK (TO BE POSTED ONLINE ASAP)
Additional Benefits
Direct Payments to adults of $1,200 or less and $500 per child ($3,400 for a family of four) to be sent out in weeks. The amount of the payments phases out based on earnings of between $75,000 and $99,000 ($150,000 / $198,000 for couples). Section 2201.
Expanded Unemployment Insurance: Includes coverage for workers who are furloughed, gig workers, and freelancers. Increases payments by $600 per week for four months on top of what state unemployment programs pay. Section 2104.
Amendments to the New Paid Leave Mandates: Lowers the amounts that employers must pay for paid sick and family leave under the Families First Coronavirus Response Act* (enacted March 19) to the amounts covered by the refundable payroll tax credit – i.e., $511 per day for employee sick leave or $200 per day for family leave. Sections 3601 and 3602.
Significant Spending: The law also calls for large infusions of cash to the following sectors:
- $150 billion for a state, tribal, and local Coronavirus Relief fund
- $130 billion for hospitals
- $30 billion for education
- $25 billion for transit systems
Legislative Resources
- Coronavirus Aid, Relief, and Economic Security (CARES) Act, H.R. 748 legislative text
- A section-by-section for unemployment insurance and tax policy
- A section-by-section for health policy
- A section-by-section for appropriations
- A section-by-section for banking policy
SUBSCRIBE AT TOP OF THIS PAGE FOR SMALL BUSINESS ADMINISTRATION CARES ACT APPLICATION LINK (TO BE POSTED ONLINE ASAP)
CARES Act for Nonprofits – Charity Stimulus Package was adapted from National Council of Nonprofits’ Initial Analysis of the Coronavirus Aid Relief and Economic Security Act
For more articles like CARES Act for Nonprofits – Charity Stimulus Package VISIT HERE
Inside Charity content and comments are for informational purposes only, you should not construe any such information or other material as legal, tax, investment, financial, or other advice. All content on this site is information of a general nature and does not address the circumstances of any particular individual or entity. Nothing on this site constitutes professional and/or financial advice, nor does any information on the site constitute a comprehensive or complete statement of the matters discussed or the law relating thereto.
122 Comments
For the Paycheck Protection Program Loans (emergency SBA 7(a) loans), I’ve read different interpretations re: exclusion of employees earning $100,000: does it mean the entire employees’ earnings are disqualified; or does the first $100k apply and just the portion above $100k not apply?
Steve we’re working with payroll consultants next week to figure out an accurate answer to your question.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
I have a nonprofit business with six volunteers. The business is run from the office located at my home office. Being that as it is, would I be eligible to apply?
It’s good idea to lend a help to make the world better
My organization is a 501c3 non profit Homeownership Center specializing in Homebuyer Education, Homeownership Counseling, Foreclosure Mitigation Counseling, Credit Coaching education and counseling. All of these services are free. We also offer below market rental units (no subsidized but we accept Section 8 vouchers), this is the majority of how we sustain the organization. We are a staff of 9. We also have a note with the bank for a 33 unit apartment complex that we constructed. Would we qualify for this type of loan that will qualify for a grant? If so, where do we apply? Thank you.
Elizabeth, according to our experts nonprofits will use the Small Business Administrations Website (https://SBA.gov) to apply for their grants and/or loans. At first glance your charity will be eligible for both grants and loans. We’re working with experts and will have more accurate answers for you next week. KEEP THE FAITH.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
Thank you Gabe. Have a wonderful day, keep safe.
My organization is a 501c3 Community Visual Arts Center – an art gallery, classes and workshops including several for underserved populations. We have a staff of 6 part-timers. We have kept everyone employed but with less hours because we are closed. Would we qualify for this type of loan that will qualify for a grant so we can keep paying our rent and our staff?
Lisa, every indication is that you will be able to apply for a loan that will then be “forgiven” if you spend the loan dollars on salaries, rent and utilities. Our understanding is that your LOAN will be turned into a GRANT once you report your expenses. Please watch your inbox for more updates. We’re working with the Small Business Administration to prepare you for next steps.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
What am I missing on how a non-profit school could qualify for an SBA 7 loan? Everything on the SBA website says to qualify for an SBA loan you must be for profit. I am not seeing any programs through the SBA for non-profits. Any assistance would be great.
Hey Kim,
Sometimes SBA language can be confusing because it often uses the term “owners.” Here’s the good news, SBA considers NONPROFITS to be a business. Why? Because nonprofits are businesses. If you take a deeper look there are all sorts of references to nonprofits on the SBA site e.g.
“The SBA will work directly with state Governors to provide targeted, low-interest loans to small businesses and non-profits that have been severely impacted by the Coronavirus (COVID-19). The SBA’s Economic Injury Disaster Loan program provides small businesses with working capital loans of up to $2 million that can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing.”
PLEASE NOTE: Earlier this month two bills were signed into law that PRECEDED the CARES Act. The Small Business Association HAS NOT updated their site with new information or applications regarding the CARES Act.
Please watch your inbox for more updates. We’re working with the Small Business Administration to prepare you for next steps.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
This is my 2nd year of summercamp with low income family in my community I have 5 full time workers&3 part-time Workers Family are looking for jobs and some are returning back to work they’re looking for a place for there children we are a 501c3 I have no money to help them this year because of the pandemic would we be qualify for a government grant for our low income
Community
Iess previllage is our concern
Everything i read says it will take longer to hear about the Paycheck Protection progam so small non-profits should consider filing application for SBA $10k grant and the EIDL loan. If both of those are approved and then the organization is approved for Paycheck protection, do we roll the EIDL and SBA grant into that to have it all be “forgiven” or do they offset the forgiveness?
Meg,
We’re working with Wegner CPAs who has over 800 nonprofit clients to uncover accurate answers to important questions just like yours. Your inquiry is a great one and we hope to have an answer for you by end-of-business on Monday.
https://www.wegnercpas.com/who-we-serve/non-profits/
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
My apologies if my questions are uninformed but I need some clarification please. The CARES Act Section 2301; Tax Code Section 3111) states “Certain employers may receive a payroll tax credit of as much as $5,000 per employee for wages (and health benefits) paid after March 12, 2020, and before January 1, 2021. If the credit amount exceeds the employer’s liability, the excess shall be refundable.”
1) what is meant by a payroll tax credit – is this a credit for future payroll taxes?
2) is the credit a flat $5K for wages paid OR for taxes paid on those wages?
3) can you provide an example of the exact calculations for this payroll tax credit?
Your response will be much appreciated.
Edie, everything has changed since March 29. Here’s what we know now.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
I am a director of a Christian camp.
Will you all cluster information (501c3’s) together in what we should do, where to apply, etc?
What I mean by cluster is,
Information for
1. Churches
2. Camps
3. Etc
Randy,
Clustering will not be complicated. Yes, we will post ASAP the article directing all nonprofits, ministries and churches to the correct website as soon as it’s online.
The Federal Government will use the Small Business Administration to distribute GRANTS & LOANS to the following charitable businesses:
ANY NONPROFIT, CHARITY, CHURCH or MINISTRY that files a FORM 990.
THEY ARE ALL BUSINESSES AND ARE ELIGIBLE FOR GRANTS & LOANS UNDER DETERMINED CONDITIONS.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
I am the ED of a Michigan nonprofit. We provide food and emergency financial help to low-income families. Including myself there are 7 staff. I plan to keep my staff through this crisis. Is there any other criteria that is not listed above that nonprofits have to have to be eligible for this loan (grant)?
Terri,
It’s our understanding that there are other details in the CARES Act Bill. e.g. Loans used for salaries above $100,000 will not be “forgiven.”
Here’s the good news. YOUR LOCAL BANK AND/OR CREDIT UNION will be the first to be informed by the Small Business Administration about “other criteria.”
We recommend calling the BUSINESS LOAN DIVISION of your local bank, credit union or qualified lender to learn more. (EVEN THOUGH THEY WON’T KNOW THE ANSWERS FOR ABOUT THREE WEEKS!) Regardless, start relationship-building with the institutions that are authorized to provide you your LOANS/GRANTS.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
Hi! I pastor a church which is 501c3 registered. We haven’t filed anything yet however we have a paid staff. will we be able to quality for a loan. This will greatly help us with coving our staff payroll.
We are a non profit with three thrift stores that funds six other non profits with our profits. Yesterday due to lack of business we had to lay everyone off. All together we had 38 employees. We have lots of overhead even though we are closed due to rents, payments and utilities. Will we qualify for forgiveness loan?
Debbie it is our understanding that the answer to your question is YES. You will be able to receive funding for utilities, rent and salaries ultimately as a grant. Initially, you will apply for a loan. However, if you demonstrate that you spent loan monies on utilities, rent and salaries those loan monies will be “forgiven” and will not require repayment.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
Will employees of religious organizations that do not pay into the state unemployment system be eligible for unemployment benefits now through the CARES Act?
Thank you.
Susanne,
This is a great question. My answer is based on our understanding of our limited understanding of existing unemployment laws that are universal to all 50 states. They are as follows:
In all 50 states, 501(c)(3) organizations must pay unemployment insurance benefits—and they can do it one of two ways:
Pay state unemployment insurance (SUI) taxes
Reimburse the state only for benefits paid to former employees
If I understand you correctly your organization has opted out of paying unemployment insurance (SUI). Regardless, your organization would still have to pay unemployment insurance fees retroactively to the State if one of your former employees applied and was approved for unemployment.
Here’s where it gets a little bit more confusing. It’s our understanding that at this particular moment for-profits and nonprofits are exempt from unemployment insurance fees will not have to pay their State SUI taxes for any employees laid off due to our current national crisis.
So the answer to your question is I don’t know. However, I suspect that your employees may very likely be eligible for unemployment at no expense to you.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
Question About Loan Amount: The lesser of $10 million or 2.5 times the average total monthly payroll (including benefits) costs from the one-year period prior to the date of application.
To ensure I understand this correctly is this stating that as a non-profit we will be eligible for 2.5 times the average total monthly payroll of all our employees for an entire year? Am I misreading this?
Thanks,
-Mike
Today’s Senate Brief (explaining the CARES Act) further stated:
“Loans are given up to a maximum of the lesser of $10 million, or 2.5 times the average monthly payroll costs – including wages for employees making under $100,000, as well as expenses for paid sick leave, healthcare and other benefits – during the 1-year period before the date on which the loan was made.”
HOWEVER…it is our understanding that the same brief indicated that no individual employee can be compensated more than a TOTAL of $10,000 during the combined period of April, May & June if you expect that portion of the loan to be forgiven.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
Do you have to complete an application for the EIDL in order to apply for the Paycheck Protection Program loan?
Pam,
Our understanding is that your EIDL loan may be combined with PPP if and when PPP is made available. Regardless, our further understanding is that you DO NOT have to apply for EIDL in order to be eligible for PPP.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
Hi. My question is if I have a non-profit school where I outsource contract help for the creation of my board, doing contract work to hire staff and teachers, and outsourcing help wirh marketing and grant development for the school, do I qualify inder the CARES Act. I have a total of three business that I outsource work on behalf of the school. Thanks!
As a domestic violence shelter program, some of our salaries are reimbursed by a Dept of Justice grant. How does that affect our application for the EIDL? Our revenue has been negatively affected through two of our programs, and we are thinking that makes us eligible? Can you help clear that up for us? Thank you!
Sandy
Sandy,
Thousands of nonprofits are recipients of Federal, State & Local reimbursements. Our understanding of the CARES Act is that your existing income (DOJ reimbursements) will in no way shape or form affect your eligibility for CARE Acts funds. You are a important 501c3 nonprofit in need of CARES Act funds.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
Will religious non-profits be subject to any “equal rights” laws if they take a CARES loan from which they are currently exempt on religious grounds
Roy,
Our understanding is that the Government wants to get as much money into the charitable sector as possible regardless of race, color, religion or creed. Based on our limited (yet thorough) analysis there are no restrictions connected to “faith.” We do not believe that “equal rights” are in play or would factor into your application.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
Our 501 c 3 Museum is run solely by 30 + veterans and volunteers. There are 3 employees that are paid by an outside company as its donation to the museum. All have been temporarily laid off.
Our income, for the museum’s expenses, comes strictly from tours, grants, events and donations. We had to temporarily close in early March, and cancel events that help us pay our utilities, and recurring bills. We have recently had to cancel our April events as well. With nothing coming in we may last through June. We are Located on the Mississippi River, in Louisiana. Would we qualify for any assistance and/or a loan? We have been open since 2013 and do a lot for veterans in our community, along preserving history from local and regional veterans of WWII. Thank you for this forum where we can ask these questions!
Patty, every indication is that you will be able to apply for a loan that will then be “forgiven” if you spend the loan dollars on your 3 employee salaries, rent and utilities. Our understanding is that your LOAN will be turned into a GRANT once you report your expenses as salaries, rent and utilities. In addition your museum can also secure loans from the Small Business Administration to cover a myriad of expenses (other than salaries, rent & utilities) at a rate of 2%-4% to be paid back within 5 years.
Please watch your inbox for more updates. We’re working with the Small Business Administration to prepare you for next steps.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
I need to clarify that my question strictly pertains to keeping the museum open by paying recurring bills and not paying employees.
Thanks again for the further inquiry. Please see our response above.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
What if you are a registered non-profit church but not a 501c3, will you receive benefits?
Kim,
Our understanding is that churches who do not file a FORM 990 are not eligible for corporate relief. However, your leaders may be independent contractors who may apply as ICs to the Small Business Administration.
We are a 501(c)(3) organization who was shut down for 15 months because a previous landlord broke our lease after we spent $44K fixing up his space. We just recently reopened in a space that while it does not meet all of our needs, does provide the space we need for our essential business. We support all schools, churches, NFPs, daycares, government offices, etc., in the St. Louis County area with resources for creative learning. We also provide an exercise, dance program for children and adults with Down Syndrome. The minute this virus hit, we lost all of our customer base because schools and everything else have been shutdown. We were not open in 2019, so we do not have a 990 for that year, but have been in business for the past 30 years. We have no funds with which to pay our 3 part-time employees or our leasing agreement. Are we eligible for this funding?
Dear & Good SANDRA O’DELL,
Your question is a great one. Even though you WERE NOT OPEN in 2019 you were still required to file a 990 (with no revenues) UNLESS YOU DISSOLVED your nonprofit (according to the dissolution resolution withing your by-laws). Here’s the good news…our understanding of the CARES Act allows you to apply using your 2018 FORM 990.
I look forward to hearing what happens.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
We also serve 48 counties in the State of Missouri and 11 counties in the State of Illinois with our resources.
Sandra, please see response above.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
Am I correct in understanding that only 501(c)3 organizations that have PAID staff are eligible. If an organization is all volunteer including full-time members Is there any way they could qualify for operational assistance?
Sherry,
NO…our understanding of the CARES Act allows you to apply for both loans and grants EVEN THOUGH YOU HAVE NO PAID STAFF.
GRANTS will be made available for utilities and rent. LOANS will be made available to for all other reasonable expenses needed to keep your doors open. Loans will have reasonable interest rates of 2.5%-4% and need to be paid back within five years.
If this is so then how do we fill out the form when it says to check 2 and we only have utilities — no rent and no payroll? What does “Other” include? Sorry I asked this before but had no response. Thank you for all you are doing to help us.
Hello a couple audiors have told me our organization cannot apply for PPP because we do not have any paid employees despite that we have been significantly effected losing 100%of our revenue and continued operating cost. We were hoping to get assistance with rent and utilities during these months we have been forced to shut down. Do you have a specific reference I can site that shows we can qualify? Or any insight on the application and what we enter in under number of employees? Do you know of any other organization with no employees who have qualified. Sorry just looking for any kind of hope for our non profit.
Kristal,
We’re disheartened to share that it has become apparent to us that organizations who do not employ W-2 staff members are not eligible for the PPP Loan program. The loan amount is calculated based on payroll registers. You can use the loan for other bills but cannot receive it in the first place if you have no W-2 employees.
I am the CEO of a non profit 501(c) 3, I have no paid employees as we are all volunteers. If my non profit is not eligible for the cares act, am I eligible for a stimulus myself? I am having a difficult time keeping up my rent because of covid 19, we haven’t been receiving donations regularly because of covid 19.
I pastor a small church. I’m considered a “contract employee” and file my own taxes. I also get a housing allowance. Can you tell me if my being contracted makes any difference.
Richard,
It is our understanding that you can apply for relief as an independent contractor at:
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
(Our interpretation of the CARES Act does not disclude Independent Contracts who benefit from Social Security Exemption and/or Housing Allowance)
Do Christian schools that do not have 501(c)3 qualify for the loan and can they take credit on salary and expenses paid
Bernie,
Our understanding of the CARE Act would suggest that If you school is incorporated you are eligible for a myriad of CARES Act benefits. YOU ARE A BUSINESS. Work with your FDIC insured local banks, credit unions and/or qualified lenders to access CARES Act Funding for businesses. If you are incorporated YOU ARE A BUSINESS that maybe eligible.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
I’m the executive director for a nonprofit (501c3) community center – pools, gymnasium, fitness center, dance studios and community spaces – and we have a total of 88 employees, but most of them are part time. Our part-time instructors (swim and dance) and our lifeguards work just a few hours a week – so we truly don’t have the fulltime equivalency of that many employees. A total of 13 full time, and probably about 6-8 part time (20 hours/week), plus a myriad of employees who work just an hour or two a week. My question is that all of the small business loans and grants seem to disqualify us for having more than 50 employees. Is there a way to calculate according to fulltime equivalency? Thanks for any help!
My charity is a 501(c)(33). However, the majority of our employees are people in other countries. Would my charity be able to borrow to make payroll for all of my employees? We do file a Form 990.
[…] Right now, you can be a hero to your non-profit partners and friends. There is a provision for them in the newly enacted CARES Act that provides payroll and other relief to help them keep their doors open. Tell them about it, and help them apply. For more, check out this round-up for of the benefits from Inside Charity. […]
Thank You Stratiscope! We’re all in this together.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
I am a director of a nonprofit that helps under intellectually developed children. The majority of our revenue come from our state dept of human services, which I believe gets there funding from Medicaid. Would we still be eligible for PPP?
We are a non profit 501c3 that is federally funded. Can we still receive CARES funds?
I have read the SBA web page. It does not say how you apply. I read somewhere else that your bank is supposed to assist you. Do you know how we apply and when? Also, any employee earning over $100k is not allowed to be a part of the request, correct? Thank you.
We are a religious 501(C)(3) exempt from filing form 990. The majority of our programs are overseas. The individuals working overseas are on our payroll, exempt from federal withholding taxes but subject to FICA. Their salaries are reported on form W-2. Would we qualify for grants/loans? If so, would the costs of the compensation/benefits benefits be used for the loan application?
For the Paycheck Protection Program, how do the affiliation rules for determining the 500 employee limit apply to churches/congregations/parishes? For example, are all parishes in a an area considered affiliated with each other?
Suppose that, before the CARES Act was enacted, a Church furloughed some of its employees. Could the Church recall them and apply for the CARES Act payroll relief loan and still both get the loan and get forgiveness if it complies with the stated conditions for forgiveness?
First, thanks so much for providing this resource. The questions and comments have been very helpful.
The EIDL Act refers to eligibility of “private nonprofits.” We are a 509 (a) (2) public charity, exempt under section 501 (c) (3,) which files a 990 every year. Can you provide any guidance with respect to the eligibility of public charities? Thanks.
Chris, if you read the entire paragraph that begins with “”private nonprofits” you’ll see by the end of the same paragraph any organization that is “501c3”
Our understanding is that this confusing line item APPLIES TO ALL 501c3 Organizations.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
Thank you for explaining above in the comments that the SBA considers nonprofits to be businesses.
We are a PA nonprofit with 5 directors. In an SBA application, who are the owners? Are there no owners? Are the 5 directors 20% owners? Thank you.
Chris,
YOUR COMMUNITY IS THE OWNER OF YOUR NONPROFIT.
(The SBA hasn’t had to the time to distinguish between for-profit and nonprofits on the application)
Regarding that arbitrary line item, my limited understanding is that you name your BOARD CHAIR as the agent representing the community (again, your community owns your charity)
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
Many thanks for all your help Jimmy!
Hello ,
I work for a 501(c3) Conference, Camp & Retreat Center. We have been hit really hard as well as others. We have less than 20 employees that we have sent home weeks ago & now we are wondering if our mission here will with stand this crisis in America. Can you tell me if we will qualify for these loans that will be forgiven?
Kristine,
Our understanding of the CARES Act leads me to share both a simple and complex answer WHICH IS YES!
VISIT THESE TWO SITES:
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
Hi Mr. LaRose,
We are a 501(c)(3 ) nonprofit organization with a mission of providing medical help to countries in Africa. We are based in the USA, we do not have any employees, but we have volunteers and members. Are we eligible for this kind of program? Thanks.
Be of good cheer. Even though YOU RECEIVE NO PAY there is recourse. (Somewhat complicated BUT REAL)
Call Lisa Van Zyll to setup an appointment with NANOE. We’ll help you chart a course.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
Hello,
We are a 501(c)(3 ) nonprofit organization with a mission of providing medical help to countries in Africa. We are based in the USA, we do not have any employees, but we have volunteers and members. Are we eligible for this kind of program?
What is the applicant doesn’t have a good credit sore. Thanks.
Be of good cheer. Even though YOU RECEIVE NO PAY there is recourse. (Somewhat complicated BUT REAL)
It is our understanding that credit scores are not as important as GETTING YOUR ORGANIZATION MONEY TO RELIEVE THE ECONOMY.
Call Lisa Van Zyll to setup an appointment with NANOE. We’ll help you chart a course.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
I work for a non-profit that has locations across the country. Each sub location is responsible for their own financial means and pay a “field service” to the “parent” organization. At our location, which covers 3 counties, there are less than 500 employees, but if we are viewed as our “corporation” we exceed this amount. My question is this: For organizations that exist in local areas, but do not have complete decision making capabilities in those local areas, but are fiscally responsible for all of the “costs” of operations, and financially support the “parent” company; what does the CARES act consider this to be? Will the local level “child” be able to receive assistance through the CARES Act?
Ashley, BEST QUESTION OF THE DAY.
Be of good cheer. Even though your situation is complex our understanding is that…YOU ARE ELIGIBLE FOR SEPARATE FUNDING BOTH NATIONALLY AND LOCALLY (somewhat complicated BUT REAL.)
Call Lisa Van Zyll to setup an appointment with NANOE. We’ll help you chart a course.
https://www.sba.gov/funding-programs/disaster-assistance
https://www.sba.gov/document/sba-form–paycheck-protection-program-ppp-sample-application-form
We are a small non-profit that has no employees and is all volunteer run. I viewed the application and it states you must check 2 areas of need. We want to apply for utility needs but pay no rent as our building is with the county on a long-term lease. I do not see how I can check 2 areas if we only have utility needs. What do they consider under “Other” category?
Thank you for a great site!
Clyde H. Brooks, Chairman
We are a 501 (c)(3). We know we are eligible for the SBA PPP loan. We get a portion of our salaries reimbursed by federal and state grants. Will we be allowed to claim these salaries on our state and federal grants if we receive the SBA money and it is forgiven? Will the grants consider that double dipping?
I serve on the board of a 501c7 “not for profit”, . We operate what is essentially a shooting facility for things like rifle marksmanship, shotgun sports such as skeet and trap and sporting clays. We have various venues that have been closed since this thing started and employees unable to work because of state mandated closures. I see everything mentioning 501c3 so I am unsure if that excludes us or if we fall under that somehow and are eligible for several of these items.
Corey, I posed essentially the same questions than 24h hours after you. Please let me know if you hear anything in response.
501c7 is NOT eligible for the PPP. It is eligible for the EIDL – only non-profit charities, veterans programs and tribal affiliations can get the PPP money. Sorry I know a lot of 501c7 that could this as well but a 501c7 is considered a private social club for recreation and not a charity under 501c3 – these are both very different under the IRS code 501c
Stacie,
Thank you for your comment. We share the same view.
Yes, I have a non profit cat rescue- with over 50 cats, I have volunteers but no paid employees.
Our donations are way down, would we qualify for this.
I’m a trustee with the Eagles Club 588, a Not For Profit organization based on people helping people. Our business which includes a large brick and mortar building and bar, employees (2 full time and several part time) has been fully closed since this began with no money coming in to pay the bills. Do we qualify for any of the programs in this initiative?
No update as of yet for me for the “not for profit 501c7”. The language in the guidelines specifically states 501c3 and the 501c19 so part of me thinks we would not qualify but we did in fact submit an application with our bank last Friday. I don’t think the bank really knew but they did accept the application. I think the part that falls back on us though is if the loan is forgivable and don’t know if the responsibility for that is on us or the bank. I could see the bank saying “yes we gave you the loan but The government is one who decided it’s not forgivable”. Hopefully we get more clarity sometime soon.
Hello, Since 2010 we have been a 501(c)3. I own and operate a Missouri state license no-kill animal shelter/rescue. We have no paid employees, all volunteers. We have always filed a postcard with the IRS and I have not seen any info. based on this type of filing. Does this matter or not? Do we still qualify for any relief? We may not have any paid employees but we still have many mouths to feed, vet care, leases, utilities, etc. with zero revenue coming in from our retail thrift store.
Hi,
We are a 501(C)3 nonprofit made up of 100% volunteers, located in MA. Our major source of income is running pancake breakfasts, which have now been shut down due to the Covid-19. Our organizations single biggest expense is our property tax. Could any of the Cares Act options be used to pay this?
We are a nonprofit church applying for the CARES loan and the bank said the owner (someone who owns at least 20%) must sign the loan application. So who would sign this since there is no owner. The pastor is the president and we have a board.
If you have a non-profit and you have not filed all of your paperwork and you have a fiscal. Can you get some support.
CEO Cynthia Harris
We are a 501(c)(3) all cat rescue. We have volunteers but no paid employees.
We solely rely on donations to keep this Rescue running.
Do we qualify for the cares act and what lending agency do you recommend us to use.
Thank you
Hello. We just received our 501c3 on November of 2019 for my non-profit organization-Garmany Tutorial Services where we provide supplemental education resources to at risk/ special needs youth and their families. I have one employee and we are newly developed with no funds right now. Which Care Act option will suit our organization and where would we apply? Thank you.
Natasha,
Please visit here for specific updates regarding both EIDL loans and PPP Loans for nonprofits: https://insidecharity.org/inside-charity-articles/
The Small Business Administration’s (SBA) Economic Injury Disaster Loans (EIDLs) may be your first line of support.
https://www.sba.gov/funding-programs/disaster-assistance
These loans aren’t new. They’ve always been available in the event of disaster. However, according to Alex Contreras, Director of Preparedness, Communication, & Coordination at the Office of Disaster Assistance for the SBA, this is the first time a virus or pandemic event has been defined as a disaster. Because of this declaration, businesses in every state and territory are now eligible to apply for Economic Injury Disaster loans.
On another note, we would recommend contacting your local bank about your eligibility for Paycheck Protection Program Loans.
https://home.treasury.gov/system/files/136/PPP–Fact-Sheet.pdf
Also here is the link to the application form:
https://home.treasury.gov/system/files/136/Paycheck-Protection-Program-Application-3-30-2020-v3.pdf
Note that it was revised late Thursday night and is different than the earlier sample.
You’ll see the list of eligible institutions at the top of the application form.
Thank you very much Jimmy LaRose!
Thank You Good Natasha. Stay in touch!
Hello, Since 2010 we have been a 501(c)3. I own and operate a Missouri state license no-kill animal shelter/rescue. We have no paid employees, all volunteers. We have always filed a postcard with the IRS and I have not seen any info. based on this type of filing. Does this matter or not? Do we still qualify for any relief? We may not have any paid employees but we still have many mouths to feed, vet care, leases, utilities, etc. with zero revenue coming in from our retail thrift store.
We are a non profit 501c3 Filing 990. We have a small number of regular employees, but a large number of seasonal, summer employees. Do I include the seasonal employees in my count when applying
Chuck,
Our understanding is that there is no downside by including seasonal employees especially if your 2019 payroll register and payroll tax liability reflects those hires.
Hello – We are a 501(c)(3) that is a “publicly supported organization described in section 509(a)(2)”. Despite the potentially confusing reference to “public” support, we believe that we can represent “Applicant is a private non-profit organization that is a non-governmental agency or entity”. Do you have a perspective on this?
Kent,
Our understanding is that you are eligible for the PPP Loan program. We understand that most 501c organizations may participate.
We are a non profit 501(C)3 animal rescue with no paid employees, volunteers only but have a lot of four legged mouths to feed, donations are down, and utilities need paid.
Would we qualify for this?
Jeania,
Our understanding is that the PPP Loan program uses payroll to calculate loan amounts. It may be hard to receive PPP relief funding without payroll. However, there is the Economic Injury Disaster Loan Program that does not seem to rely on Payroll.
Visit here to learn more: https://covid19relief.sba.gov/#/
[…] the Charitable Giving Incentive allows donors to deduct more of their charitable giving and lifts the existing cap on annual contributions for those who itemize, raising it from 60 percent of adjusted gross income to 100 percent. For corporations, the law […]
Does this bill have anything that provides some kind of help to a non profit addiction program who charges rent (legally called program fees) to residents of the program? For example can the non profit get help so that they can pass it along to the residents who pay this rent? Especially while jobs are either cutting hours or laying people off….
Scott,
Our understanding is that you are eligible for the Emergency Injury Disaster Loan provided by the Small Business Administration. Visit here to learn more: https://covid19relief.sba.gov/#/
Scott,
Our understanding is that you can use the PPP Loan for receivables and expenses in addition to payroll, rent & utilities. Any portion of the loan not spent on payroll, rent or utilities will have to be paid back. I know this a bit confusing because your loan amount is calculated based on one month’s payroll multiplied by 2.5. However, should you receive the PPP Loan our understanding is that you can spend it on other bills.
Is a Not-for-Profit business, a 501 c (8) eligible for the PPP? I’m talking about a fraternal organization such as the Moose Lodge?
Linda, I posed this question on 4/2 with no response. Please share any reply you get.
Deborah,
Thank you for your patience. We’ve received hundreds inquiries regarding 501(c)2, 501(c)6, 501(c)7, 501(c)8 etc. We apologize for not getting sharing our responses with you.
Deborah, the IRS states that 501(c)(8) describes fraternal beneficiary societies, orders, or associations operating under the lodge system (or for the exclusive benefit of the members of a fraternity itself operating under the lodge system)
We wonder if the writers of the CARES Act bill consider the function of a 501c8 less essential than other types of organizations. Our understanding is that 501c8 organizations are not likely to be eligible for PPP.
Linda,
The IRS states that 501(c)(8) describes fraternal beneficiary societies, orders, or associations operating under the lodge system (or for the exclusive benefit of the members of a fraternity itself operating under the lodge system)
We wonder if the writers of the CARES Act bill consider the function of a 501c8 less essential than other types of organizations. Our understanding is that 501c8 organizations are not likely to be eligible for PPP.
I am on the board of a not for profit 501 c 3 . we got money under the PPP. our auditors are telling us if we get money from grants which also cover some of the Payroll costs for jobs done under the grants, we have to return that money either to the PPP or the grant funder we cannot apply for the waiver for that amount. Is that right? my logi is that if we used our cerdit line to make payroll and then someone donated money to cover that credit line we wouldn’t have to return the money to the grant, why would we have to do that here?
It is our limited understanding of the CARES Act that regardless of WHEN you received your PPP Loan you may apply a portion of those loan monies to payroll YOU FUNDED AFTER April 3rd (the day the bill was signed). It is also our limited understanding that a portion of that will be forgivable.
One of our members asks:
“My executive director insists that she applied for the EIDL loan and EEIJG grant in a single application early this month. Is she accurate or mistaken? If accurate, great. If not, where and how does one apply for the grant?”
Good Morning,
Our experience is close to what your ED experienced. First, we applied for both EIDL Loan and EiDL Grant on April 4th. Second, we received our EIDL $10,000 advance grant about two weeks later. Third, we have no real sense that SBA has ever considered our actual EIDL loan request in any way shape or form (even though we requested a loan April 4th.)
Does that make sense?
I filed for the Economic Injury Disaster Loan Program over two weeks ago and have not heard anything yet. Is there a way to follow up to check on the status of the application?
we are Christian Organization formed to help people in needs of helps,such as financial help.So if you are going through financial difficulty or you are in any financial mess,and you need funds to start up your own business,or you need loan to settle your debt or pay off your bills,start a nice business, or you are finding it hard to obtain capital loan from local banks,contact us today via email ([email protected]) at 3% interest rates for the bible says””Luke 11:10 Everyone who asks receives; he who seeks finds; and to him who knocks, the door will be opened”So do not let these opportunity pass you by because Jesus is the same yesterday, today and forever more.Please these is for serious minded and God fearing People…Regards Management E-mail : ([email protected])
Thank you for sharing this information about cares act for nonprofits. It was useful and interesting. You indeed have written it in a layman way so that anyone can understand and work accordingly. You have done a great job… Great post!!
[…] Download Image More @ insidecharity.org […]
Hello- It’s November 2020 and at this time of the year I usually do my charitable contributions. My local library, theater, public TV among others. In 2019, I didn’t have enough to deduct to itemize, so I took the standard deduction. Now with the Cares act, I understand that you can take the standard deduction PLUS up to $300 in charitable donations. My problem is, how can I determine if my local library, theater, public TV are considered to be qualifying charities?
Thank you.
Hello,
I’m the president of a local 501c8 organization. The majority of our profits go to paying our monthly bills, food costs, taxes and 8 hours weekly for an employee. The majority of our lodge is operated and managed via member volunteers. Is there any utilities assistance since we continue to get shut down due to virus spikes?
Thank you
Is there a Cares Package that nonprofits can access if they kept employees on the payroll in 2021 – I was contacted by someone who indicated that this was included in the Cares Act – although I do not see anything similar – he indicated there is up to 26k available per employee that was kept on payroll that we could qualify for and that he could help us apply ?