Congress Passes Third COVID-19 Emergency Bill that Includes Provisions Impacting the Arts and Nonprofits

Submitted by Carmen Graciela Díaz on March 27, 2020

Congress gave final approval on Friday, March 27, to a $2 trillion measure that will deliver "direct payments and jobless benefits for individuals, money for states, and a huge bailout fund for businesses" battered by coronavirus crisis, as The New York Times reported.

As Americans for the Arts wrote, the measure includes provisions supporting the arts:

This vital piece of legislation includes direct support for both nonprofit cultural organizations and state and local arts and humanities agencies, as well as economic relief provisions for independent contractors, "gig economy" workers and artists, entrepreneurs, and small businesses working in the creative economy.

Specific provisions related to small businesses, employing less than 500 workers, as well as nonprofit organizations outlined in the bill include:

Charitable contributions– allows individuals to make contributions up to $300 to qualifying charities and deduct the contribution “above the line” in computing adjusted gross income (AGI). Also modifies the AGI limitations on charitable contributions for 2020, to 100% of AGI for individuals and 25% of taxable income for corporations.
Employee Retention Credit – provides a credit against social security payroll taxes (6.2%) for any business – including non-profits - that close or suspend its operations due to the virus.
Delay Payroll Tax – Employers - including non-profits- struggling to make payroll would be able to delay their share of the 6.2% Social Security tax that would otherwise be due from now until the end of the year.
Economic Injury Disaster Loan (EIDL) – Creates expedited access to capital by establishing a $10 billion program for small businesses, including non-profits, who have applied for an EIDL loan to request an advance of up to $10,000 on the loan to provide paid sick leave to employees, maintaining payroll, and other debt obligations.
Paycheck protection program - $350 billion for 8-weeks of cash-flow assistance to small business and small non-profits (under 500 employees) through guaranteed loans. Loan may be forgiven if they largely maintain their payroll.
Economic Injury Disaster Loan (EIDL) – Creates expedited access to capital by establishing a $10 billion program for small businesses, including non-profits, who have applied for an EIDL loan to request an advance of up to $10,000 on the loan to provide paid sick leave to employees, maintaining payroll, and other debt obligations.

On Tuesday, March 31, Americans for the Arts will be hosting a virtual check in about their work to provide support, research, and advocacy to the nonprofit arts sector with a special focus on the COVID-19 federal bill and what the impacts are for arts organizations, artists, and the creative economy.