New COVID Relief Package Grants Many Associations Access to PPP
Client Alert
The massive stimulus package approved by Congress late yesterday includes long awaited relief for many 501(c)(6) organizations. The package makes 501(c)(6) organizations eligible for loans under the Paycheck Protection Program (PPP) if they meet the following requirements:
- The organization does not receive more than 15% of receipts from lobbying;
- The lobbying activities do not comprise more than 15% of activities;
- The cost of lobbying activities of the organization did not exceed $1 million during the most recent tax year that ended prior to February 15, 2020; and
- The organization has 300 or fewer employees.
Therefore, many small to mid-size organizations will be able to access the $275 billion in additional PPP funding provided under this relief package.
While some associations may have already applied for an Economic Injury Disaster Loan (EIDL), under the current regulations they can still obtain a forgivable PPP loan.
As we learn more about the relief package in the coming days, association leadership can start taking steps to determine whether a PPP loan is right for their organization. As part of this process, they should contact their banking institution to determine when and how they can apply for a PPP loan.
We will continue to provide you with ongoing updates regarding how this new relief package impacts nonprofit organizations. In the meantime, please don’t hesitate to contact a member of GKG Law’s Trade & Professional Associations team with any specific questions.