COVID Financial Relief Still Available for Churches

Have you heard a radio or television ad talking about a new payroll tax refund? Have you wondered if there was additional COVID financial relief available for churches after the Paycheck Protection Program (PPP)?

The Employee Retention Credit

In a little-known change, churches have access to a new round of COVID relief funding. Unlike a PPP loan, a church qualifies if it suffered only operational impact stemming from a government order. Proving a negative financial impact is not required to be eligible for Employee Retention Credit (ERC) relief. In short, churches that cut back programs or services qualify for these refunds.

Churches in many states were forced to close or cancel services due to state governmental orders and may qualify for this additional relief.

Consider whether during COVID your church experienced any of the following?

• Camps cancelled
• Youth group cancelled
• Small groups cancelled
• After service fellowship cancelled
• Training and meetings cancelled

If any of these things happened to your church for a period of time the ERC may be available to your church.

So, what is the big deal with the ERC?

Refunds available under the ERC can be as large as $5,000 per qualified employee for 2020 and as large as $21,000 per qualified employee for 2021.

How to get help

One of our CPA partners, Wisdom Over Wealth has helped claim over $4 million in ERC relief. Wisdom is equipped to evaluate the benefit of the ERC for your church. They will calculate the credits available and prepare the necessary forms for filing with IRS. To learn more or get your evaluation started, email Kaitlin DeWitt at [email protected] with the subject line “ERC Program.”

Additionally, Your Church Admin, a service of the Illinois District Council, has helped churches evaluate and apply for ERC relief. If you are an AG church in the Illinois district, contact Andrew Schneider at [email protected] to see if you qualify, calculate your churches credit, and prepare the applicable IRS forms 

For a thorough summary and analysis of the ERC, the Batts Morrison Wales & Lee team (nonprofitcpa.com) have created a helpful document here:  

The Employee Retention Credit - A Potential Source of Sizable Federal Aid for Qualifying Nonprofits - BMWL (nonprofitcpa.com).