May 8, 2020
Dear Nonprofit Execs & Colleagues In Service,
Unfortunately, the probability of actually receiving a PPP Loan has come to an end. The SBA announced today that as a result of an unprecedented crush of applications (and the rapid depletion of CARES Act funding by Congress) that they have CLOSED their application portal and are drastically limiting the amounts of the remaining loans they have left to offer to nonprofits and small businesses. If your nonprofit is among those fortunate enough to have received a loan or loan advance your next major hurdle will be to ensure the amount you receive is actually forgiven.
Here’s what we can confirm so far:
1. The CARES Act requires that you APPLY TO YOUR ORIGINAL LENDER FOR LOAN FORGIVENESS at the end of the eight-week period following receipt of your loan. Your lender MUST make a decision on your application for forgiveness within 60 days.
2. The IRS has ruled that any forgiven part of a PPP loan is exempt from being taxed as a “discharged debt.” This means you DO NOT have to declare the forgiven part of your loan as income when you file taxes for 2020.
3. Your EIDL loan advance WILL be deducted from the forgivable part of any subsequent PPP loan you receive.
4. To receive full forgiveness, you must retain (or rehire by June 30, 2020) all full-time equivalent employees (FTEEs) according to the baseline used to establish your loan, except for any fully documented instances in which an employee refuses the rehire offer.
5. The amount forgiven will also be reduced in proportion to any reduction in employee salary or wages during the eight week forgiveness period greater than 25% of the average amount that employee made during the base period.
Here’s the single most important task you have to do TODAY:
Secure a bookkeeper that understands all the details of The CARES Act, EIDL and PPP Loan programs VISIT HERE TO READ ENTIRE ARTICLE
Inside Charity is pleased to report that over 600 comments and questions have been
recorded at Inside Charity by nonprofit executives, staff, board members,
ministry leaders and volunteers over the past ten days. We grateful to everyone
who has participated and want to encourage as many as people as possible to
continue to share their experiences. Your written comments and contributions
have helped your colleagues navigate this process.
We are all in the throes of the global pandemic. Charities everywhere are feeling the effects of isolation measures, business shutdowns, travel bans, and markets crashing. InsideCharity is here to make sure receive the information you require to navigate these unprecedented times. We’re in direct contact with the Small Busi-ness Association (S.B.A) and In-ternal Re-venue Service (I.R.S) to provide you real-time updates you need to access CARE Act funding as soon as possible.
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