The COVID-19 pandemic has put incredible strain on our communities and the nonprofits at the frontline. The Delta Dental Community Care Foundation is committed to supporting organizations responding to the crisis. We recently announced that we are providing funding to aid in the response, and we want to make our partners and grantees aware of other resources to help them cope with the current economic uncertainty facing nonprofits.

While many people are aware of the individual checks coming their way from the federal government to help mitigate the economic impact of the COVID-19 pandemic, small businesses and nonprofits may not realize that there are federal relief measures available to them as well. The Coronavirus Aid, Relief, and Economic Security (CARES) Act has several provisions specifically intended to help ease the economic hardships faced by nonprofit organizations.

The National Council of Nonprofits has created an excellent summary of the nonprofit resources in the bill. Below is some information about Small Business Administration loan funds and relaxed regulations for charitable giving that we thought would be beneficial to our partners and grantees from that summary.

Paycheck Protection Program Loans

Eligible nonprofits can apply for loans to help cover operational costs. To be eligible, your organization must have:

  • Fewer than 500 employees (individuals – not just full-time employees)
  • Existed on February 15, 2020
  • Paid employees or contractors.

You aren’t required to put up collateral or another form of personal guarantee to secure a loan. And it can be used for payroll and associated costs (e.g., health and retirement benefits), facilities and debt service. The amount is based on a calculation of $10 million or 2.5 times the average total monthly payroll – whichever is less – from the year prior to the application date.

There are even certain circumstances in which those loans can be forgiven – which, in essence, could make the loan a grant.

Economic Injury Disaster Loan Advance

These small loans are effectively emergency grants. Eligible nonprofits with 500 or fewer employees can apply for $10,000 in funding, which will be sent by check within days of an approved application.

Self-Funded Nonprofits and Unemployment Expenses

Self-funded nonprofits can receive half the cost of the unemployment benefits they are required to pay, through taxes and other requirements, to their employees who have been laid off. Learn more from the National Council of Nonprofits.

New Incentives for Charitable Giving

The law also creates several incentives for increased charitable giving in 2020.

  • There is now a universal deduction for all taxpayers, whether they itemize or not, for charitable giving of up to $300.
  • The law also lifts the limit on contributions for individuals who do itemize from 60 percent to 100 percent of gross income.
  • Corporations now have a limit of 25 percent (previous 10 percent).
  • The corporate food donation cap is now also 25 percent (up from 15 percent).

We are living in exceptional and uncertain times, which can be especially challenging for nonprofit organizations that rely on community giving and philanthropic support. The Delta Dental Community Care Foundation is here to support our nonprofit partners. If you have questions about current funding opportunities or are looking for additional resources, please contact us at foundation@delta.org.

For more information about how the CARES Act helps nonprofits, check out analysis from:

Disclaimer: This blog is made available by the Delta Dental Community Care Foundation for informational purposes only. Accordingly, you may want to consult with your own financial and/or legal advisors before acting upon this information. The information on this blog is published “AS IS” and is not guaranteed to be complete, accurate and/or up-to-date in its content.