On December 21st, 2020, Congress approved the second-largest federal stimulus package after the $2 trillion CARES Act that was passed in March 2020. This new COVID-relief package is in the amount of $900 billion, and will ensure that the public has a faster vaccine distribution, and will give aid to those who have lost their jobs and to small businesses that have been extremely affected by the pandemic. With this in mind, the Paycheck Protection Program (PPP) has reopened for small businesses as well. Since applications for the first PPP program were only being accepted until August 2020, this second round of loans from the COVID-relief package could possibly save thousands of businesses across the country. For the full text of the new bill, click here.
Many 501(c)(6) nonprofits who did not qualify for a PPP loan during the first stimulus package are now eligible for this second round of the Paycheck Protection Program. The new PPP eligibility requirements for 501 (c)(6) nonprofits include:
- The organization must not employ more than 300 employees (up from 150);
- The organization must have used, or will use, the full amount of their first PPP ;
- The organization does not receive more than 15 percent of receipts from lobbying (up from 10%);
- The lobbying activities do not comprise more than 15 percent of total activities (up from 10 percent); and
- The cost of lobbying activities of the organization did not exceed $1,000,000 during the most recent tax year that ended prior to February 15, 2020.
This is great news for 501(c)(6) nonprofits, for the stimulus package will help them become more flexible with how they can spend their money.
This COVID-relief package comes at a great time with the New Year approaching. All in all, it will bring a new hope for those who have been hit hard by this pandemic, including families, small businesses, and 501(c)(6) non-profits.