I hope you are well and adjusting as best you can to our current situation. Be sure to continue to use TREC’s resource page on COVID-Response for helpful information, tools, and training.
As you likely know, last week, President Trump signed the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). This $2.2 trillion package is aimed at providing much-needed relief to people, nonprofits, and businesses. We’ve added a CARES Act resource page. While there are many important aspects to the CARES Act, I wanted to bring to your attention two specifics that can help your organization in these challenging times.
The first is the Paycheck Protection Program which offers loans to 501(c)(3) organizations to cover up to 2.5 months of payroll (including payroll taxes, sick time, and other leave) and associated operating costs (health benefits, rent, utilities). The loan is forgivable, meaning it becomes a grant if your organization maintains employment eight weeks after the loan, or rehires employees by June 30. The amount of loan forgiveness may be reduced if the organization reduces the number of employees. The loans cannot be used for compensation of individual employees or independent contractors with salaries in excess of $100,000.
Loans will be available through SBA and Treasury approved banks and credit unions, so check with your current bank to see if they are participating. After you find out more about what is being offered by reading the resources on our site and others, make sure it makes sense for your organization and apply right away.
The second is the Charitable Giving Incentive. The CARES Act creates giving incentives for donors to 501(c)(3) organizations with a new above-the-line deduction for total charitable contributions up to $300. This will be a universal, non-itemized deduction, so it applies to all taxpayers for contributions made in 2020 and claimed on tax forms next year. It also lifts the existing cap on annual contributions for those who itemize, raising it from 60% of adjusted gross income to 100% for individuals, and from 10% to 25% for corporations. Be sure to let your donors know about these new incentives.
I hope this information is helpful to you. Let us know what you need.
Remember, keep doing what you do best – taking care of your staff, partners, community members, and the planet. And to do that, remember you need to take care of yourself too!