CARES Act – COVID-19 Stimulus Package Update for Associations

On Friday, March 27 the President signed the Coronavirus Aid, Relief and Economic Security (CARES) Act, providing over $2 trillion for emergency aid to Americans and businesses. The Act does allow relief for 501(c)(3) non-profits, but unfortunately 501(c)(6) organizations were omitted from this round of relief.

However, The US Chamber reports that most 501(c)(6)s are eligible for Small Business Administration (SBA) loans through the Emergency Economic Injury Disaster Loan program. “This program has been in place, but was modified in this stimulus package,” The Chamber states. “One modification is that (c)(6)s can apply for a modest $10,000 advance to help with payroll, and that $10,000 does not have to be repaid.”

The US Chamber further stated that some (c)(6)s “are not eligible for the $350 billion in small business loans under the Paycheck Protection Program, which includes loan forgiveness for funds used for certain payroll, rent and other expenses. Foundations that are 501 (c)(3) organizations can apply for the Paycheck Protection Program.”

Small businesses, 501(c)(3) and (c)6 organizations are eligible for the Employee Retention Payroll Tax Credit provisions for up to $5,000 for each employee. This is available for eligible employers that have seen at least 50% reduction in revenue in the first quarter of 2020 compared to the first quarter of 2019, among other qualifying conditions.

Helpful links on CARES Act and SBA Loans: 

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