Relief for Nonprofits Self-Insuring Unemployment BenefitsIn This Section
Many orchestras are among nonprofits that self-insure unemployment benefits rather than pay state unemployment taxes. Under the CARES Act, the federal government makes payments to states to reduce nonprofit liability to 50% of the costs they incur through December 31, 2020 to pay unemployment benefits, which was extended through March 14, 2021 in the December relief package. Under the American Rescue Plan, the 50% coverage will continue through March 31, and starting April 1 federal relief would cover 75% of nonprofit liability, available through September 6, 2021. Original guidance from the U.S. Department of Labor indicated that states must first bill nonprofits for 100% of the costs, payment must be made to the states by nonprofits, and only then would the 50% reimbursement be issued to the nonprofit by the state.
On August 3, the “Protecting Nonprofits from Catastrophic Cash Flow Strain Act” (S. 4209) was signed into law, requiring states to only bill nonprofits for 50% of liability. This legislation is one of many requests the League and the larger nonprofit community (PDF) had been urging Congress to pass, in order to ease the burden of unemployment compensation costs for self-insured nonprofits. While eliminating the requirement for nonprofits to pay 100 percent upfront is a partial victory, advocates continue to make the case for federal relief to cover 100 percent of costs.
- DOL Issues Unemployment Insurance Letter to States (April 27, 2020) (PDF)
- DOL Issues Letter to States Implementing S. 4209 (August 12, 2020) (PDF)
In This Section
- Federal Assistance
- Shuttered Venue Operators Grant (aka Save Our Stages)
- Paycheck Protection Program and Loan Forgiveness
- Employee Retention Credits
- Families First Paid Leave Provisions
- Pandemic Unemployment Benefits, Including Self-Employed individuals
- SBA Economic Injury Disaster Relief and Loan Advance
- International Artist Visas
- New Charitable Giving Incentives
- National Endowment for the Arts Funding