Timely Financial Help for Nonprofits
As a result of the coronavirus pandemic, your organization may be eligible for Federal financial assistance. Below we highlight three programs that can help nonprofit organizations. Time is of the essence. Please read and act now.
1. Paycheck Protection Program
Starting this Friday, April 3, 2020, nonprofit organizations and other small businesses affected by the coronavirus pandemic can apply for loans under the federal Paycheck Protection Program (PPP) through existing SBA lenders. If your nonprofit organization has employees, you should consider this program immediately.
Borrowers will be eligible for loan forgiveness to the extent they use loan proceeds in the eight weeks after loan origination for specified payroll and occupancy expenses and if they meet certain criteria on maintaining employees.
The Department of Treasury has released the Paycheck Protection Program application and information for borrowers. These documents and more information are available on their website under the “Assistance for Small Businesses” section.
The borrowers’ information sheet states: Although the program is open until June 30, 2020, we encourage you to apply as quickly as you can because there is a funding cap and lenders need time to process your loan.
You apply for this loan through a bank that is an SBA lender. The US Chamber of Commerce issued a guide and checklist for this emergency loan here.
2. Economic Injury Disaster Loans
Also available are Economic Injury Disaster Loans through the Small Business Administration. Borrowers can apply for a $10,000 advance that does not need to be repaid. (If you also receive a PPP loan, this may affect your repayment requirement.)
Here is information on applying for an EIDL loan.
A comparison of the EIDL and PPP loan programs can be found here.
Consider applying for both loans. The EIDL loan will likely be available more quickly.
3. Payroll Tax Credits
In addition to these loans, employers may receive immediate payroll tax credits for paying employees out on leave due to the coronavirus.
The Families First Coronavirus Response Act requires private sector employers with fewer than 500 employees to provide paid sick leave or expanded family and medical leave for specified reasons related to COVID-19. See Q&A #59 at this DOL link for exceptions for employers under 50 employees.
Please let us know if you need assistance. Also please understand we are extremely busy and we are trying to help everyone as quickly as possible.
We hope you stay safe and well.
Carol & Carrie