COVID Relief Bill for Nonprofits

On December 21, 2020, Congress passed the COVID-Related Tax Relief Act of 2020 as part of the Consolidated Appropriations Act of 2021.  The Acts provide over $900 billion in relief to individual taxpayers and businesses.  The President is expected to sign the bill into law this week. 

There are several important provisions in the bill; however, there are two specifically relevant to nonprofit organizations.

Charitable Deduction Extension

The bill extends the charitable deduction for individuals that do not itemize on their 1040.  The $300 above the line deduction for cash contributions made to a qualified organization in 2020 has been extended to 2021.  The 2021 deduction is $300 for individual returns and $600 for married filing jointly returns.  

Additional Nonprofits Eligible for PPP Loans

Included in the bill is also another round of PPP loans.  Your organization may be eligible for a second loan given certain requirements are met.  In addition, 501(c)(6) organizations (chambers of commerce, professional associations, trade associations) that were not previously eligible for a PPP loan are now eligible.  There are requirements on the amount of lobbying the 501(c)(6) organization has engaged in to be eligible.  

Contributed by: Carrie Minnich, CPA, MAcct | Director | DWD CPAs & Advisors

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Disclaimer: The information contained in Dulin, Ward & DeWald’s blog is provided for general educational purposes only and should not be construed as financial or legal advice on any subject matter. Before taking any action based on this information, we strongly encourage you to consult competent legal, accounting or other professional advice about your specific situation. Questions on blog posts may be submitted to your DWD representative.