The Federal Reserve Board on Friday modified the Main Street Lending Program to provide greater access to credit for nonprofit organizations such as educational institutions, hospitals, and social service organizations. As detailed in term sheets released today, the Board approved two new loan options to provide support to a broad set of nonprofit organizations that were in sound financial condition prior to the pandemic.
The Act eases the time PPP loan recipients have to spend loan proceeds eligible for forgiveness by providing an alternative 24 week covered period and reduces the share that must be spent on payroll costs from 75% to 60%. The Act also extends the loan maturity date to 5 years for loans obtained after June 5th, extends the maximum deferment time and provides additional flexibility on the FTE and salary/hourly rate reduction formulas.
You can access access the application at https://home.treasury.gov/system/files/136/PPP-Loan-Forgiveness-Application-Instructions_1_0.pdf and the EZ application and instructions at https://home.treasury.gov/system/files/136/PPP-Loan-Forgiveness-Application-Form-EZ-Instructions.pdf
We expect the SBA will issue future guidance to further assist borrowers as they complete their applications.
On May 13, 2020, the SBA announced that PPP loans under $2,000,000 would be presumed to have met the certification related to loan funds being necessary due to the economic uncertainty caused by the pandemic, in essence providing a safe harbor and eliminating the need for further guidance on the definitions of "necessary" and "uncertainty".
In order to encourage donations to charitable organizations during the pandemic, The CARES Act will allow individuals to deduct up to $300 in charitable donations in 2020 whether a they itemize or not
Due to the challenges surrounding COVID-19, the Ohio Attorney General's Office will automatically extend the final annual report filing deadline for any organization with a May 2019 fiscal year end from April 15, 2020 to June 1, 2020 and any organization with a June 2019 fiscal year end from May 15, 2020 to July 15, 2020 No action is required to receive this extension.
As of January 31, 2020, all 1023's must be filed electronically through Pay.Gov. Forms 1024 and 1024-A are not impacted by this new requirement
The Ohio Attorney General's office has extended the deadline to file annual charitable registrations from May 15, 2020 to July 15, 2020 for calendar year organizations
Starting with 2021 information returns the electronic filing threshold is reduced from 250 to 100 or more forms filed in 2022 for the tax year 2021
The "non-profit parking tax" has been repealed retroactively to January 1, 2018. Refunds of prior tax may be obtained by filing form 990-T.
If passed, the bill would allow a church or other organization exempt under section 501(c)(3) to give away alcohol as a prize at a fundraising event, including a raffle, as long as it is sealed and in the original container
Salaried exempt employees that fall into the Executive, Administrative, Computer or Professional classifications, as defined by the Department of Labor, are exempt from the requirement to pay overtime above 40 hours per week as long as those salaried employees make a minimum salary. There is also an exemption category for Outside Sales, but we are not including a discussion of that classification in this update. Effective January 1, 2020, the Department of Labor (“DOL”) has issued final regulations raising that minimum salary from $23,660 to $35,568 or from $455 per week to $684 per week.
The DOL estimates that 1.3 million workers will be impacted by this change including 7% of the non-profit workforce.
The definition of the Executive classification can be found on the DOL website at https://www.dol.gov/agencies/whd/fact-sheets/17b-overtime-executive
The definition of the Administrative classification can be found on the DOL website at https://www.dol.gov/agencies/whd/fact-sheets/17c-overtime-administrative
The definition of the Professional classification can be found on the DOL website at https://www.dol.gov/agencies/whd/fact-sheets/17d-overtime-professional
The definition of the Professional classification can be found on the DOL website at https://www.dol.gov/agencies/whd/fact-sheets/17e-overtime-computer
The minimum wage in Ohio, which is higher than the federal minimum wage, increased from $8.55 to $ 8.70 effective January 1st, 2020.