Information for congregations regarding COVID-19
In response to the COVID-19 outbreak, the United States Congress has passed the Coronavirus Aid, Relief and Economic Security Act (CARES Act), which was signed into law on March 27, 2020. The CARES Act is intended to provide economic relief to certain individuals, nonprofit organizations, and businesses impacted by this outbreak.
Please remember to support your congregation’s ministry and called workers with your faithful offerings, even if you are not able to gather for worship.
Here are important resources that may be helpful as your congregation considers action:
Given the speed with which the CARES Act was adopted, additional guidance may be forthcoming regarding PPP eligibility requirements and terms. A list of SBA lenders is available at sba.gov.
As it becomes available, additional details and information regarding the CARES Act and the PPP will be provided on the synod’s COVID-19 resource page.
The CARES Act and its impact on planned giving
We are certainly living in unprecedented times, aren’t we? COVID-19 has changed every aspect of our lives. We want to keep you updated on anything related to COVID-19 that will impact charitable giving, like the CARES Act.
The U.S. Congress has passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act, and the president has signed it into law. Below are some of the highlights as they relate to charitable giving.
Please contact your WELS Foundation team at WELSFoundation@wels.net, your WELS Christian giving counselor at wels.net/givingcounselors, or other mission advancement representative at other WELS-affiliated ministries with questions at any time.
Highlights of the CARES Act*
• The law allows an above-the-line income tax charitable deduction up to $300 ($600 for a married couple) even if you don’t itemize on your 2020 income tax return. The tax break is available to people who claim the standard deduction, which is $12,400 for singles or $24,800 for married-filing jointly in 2020. This provision was inserted specifically to encourage charitable giving this year.
• The CARES Act impacts owners of Individual Retirement Accounts (IRAs) by providing a temporary waiver of Required Minimum Distributions (RMDs) for 2020, allowing IRA owners to keep funds in their IRAs (and other qualified retirement plans). The decreased value of their IRAs may motivate some people to keep funds in their accounts temporarily, waiting to see what happens in the investment markets. Donors age 70.5 and older may still make direct distributions to charity from their IRA, just as before, if it makes financial sense to do so.
• For the 2020 tax year only, donors may elect to apply a 100% of adjusted gross income (AGI) limit to cash gifts to public charities. Gifts to donor advised funds (DAFs) don’t qualify. This means that in 2020, a donor who deducts 30% of AGI in long-term appreciated property gifts and elects the 100% of AGI limit for qualified cash contributions will be able to also deduct up to 70% of AGI for qualified cash gifts, a total deduction of up to 100% of AGI. If this donor uses all available deductions for qualified cash gifts, that donor will pay no federal income tax in 2020. (Please note: Donors should consult their tax advisers to determine whether the 100% election makes sense for them.)
• The new law, coupled with current financial uncertainty, has created an appealing climate for those concerned about their income from investments. Please let us know if would like to learn more about how you can transfer assets (cash, securities, real estate, etc.) into a secure income stream for yourself and/or others while also providing for the Lord’s work.
• Recent steps taken by the Federal Reserve Bank on federal lending rates have made certain charitable gift strategies more appealing than they have been in some time. Please let us know if would like to learn more about how you can reduce the size of your taxable estate for a planned transfer to heirs, all while making a sizable gift to the Lord’s work.
• If you’re thinking of updating your estate plan, we would be pleased to help you consider including a gift to your local congregation and/or other WELS or WELS-affiliated ministries.
In the meantime, this is a good time to just stay in touch. Please reach out to your Christian giving counselor or mission advancement representative with questions about what is going on locally and nationally to discuss those ministries that are of most interest to you. They will be glad to hear from you.
Please continue doing everything you can to help keep yourselves, your families, and your communities safe. And as with all situations in life, we lean on our Savior’s promises that he will never leave us or forsake us. May God bless you all!
*CARES Act summary compiled by Dan Shephard of The Shephard Group
How the stimulus package applies to churches - March 21, 2020
As we work through the challenges presented by the Coronavirus pandemic, our government has passed legislation to assist employers in caring for their workers. This information is offered as a guide in response to some of the more common inquiries on the topic of compensation. You are encouraged to prayerfully make your decisions with compassion and understanding for your workers. Please understand the situation is fluid, and updates will be provided as new information is made available.
Families First Coronavirus Response Act
Under the Families First Coronavirus Response Act (FFCRA) enacted on March 18, 2020, and effective through December 31, 2020, congregations who may not have previously been considered “covered employers” under the Family Medical Leave Act (FMLA) because they had fewer than the required 50 workers, now fall within the parameters of both the Paid Sick Leave and Paid Expanded Family and Medical Leave provisions applicable to organizations with fewer than 500 workers. Here is some detailed information on employer paid leave.
A “Question and Answer” section is available on the Families First Coronavirus Response Act website.
Coronavirus Aid, Relief, and Economic Security (CARES) Act
Under the CARES Act Relief program enacted on March 27, 2020, and effective through December 31, 2020, many congregations will have new programs available to assist with unexpected financial needs such as the Paycheck Protection Program (PPP) Loans. The U.S. Senate Committee on Small Business & Entrepreneurship has provided a guide to help understand what is now available.
Also available under the CARES Act is the Employee Retention Credit which can provide for a refundable payroll tax credit of 50% of qualifying wages paid by eligible employers during the COVID-19 crisis. Additional information as provided by Michael Best can be found online.
Under the CARES Act Relief program, workers of religious non-profit organizations who do not pay into their state’s Unemployment Compensation Insurance program, meaning their workers were previously not able to collect unemployment compensation if employment ended, may now be eligible. Please be aware however that eligibility for VEBA (or other employer provided health care plans) and Pension participation requires a worker be an “active worker.” The ability to continue with VEBA coverage for any worker whose divine call has been terminated or lay worker who is laid off would fall under COBRA continuation.
Each state administers a separate unemployment insurance program, but all states follow the same guidelines established by federal law. More information regarding the updated rules in your state can be accessed here.
Common questions associated with filing for unemployment.
Additional resources on these and other topics are available from a multitude of sources. Those sources include:
Congregations are urged to contact tax and/or legal professionals to guide you through this process.
Note: The links provided in this article were selected because they may provide helpful information for you during this crisis. WELS does not own these sites and is not responsible for the information and opinions expressed on them.
- CARES Act Summary
- Faith-based organizations FAQ regarding PPP and EIDL
- Small Business Administration
- Families First Coronavirus Response Act: Employer Paid Leave Requirements
- Families First Coronavirus Response Act: Questions and Answers
- Small Business Owner’s Guide to the CARES Act
- Career One Stop: Unemployment benefits information
- FAQs on COBRA Continuation
- Additional resources on these and other topics are available from a multitude of sources. Those sources include:
- WELS COVID-19 news and updates