There is so much information out there, and it’s changing regularly, on the Coronavirus Aid, Relief, and Economic Security Act (CARES Act). Many clubs have focused on the exclusion from the Paycheck Protection Plan (PPP) and other portions of the CARES Act, however, there are other applicable sections providing relief. The following programs apply to private clubs:
Economic Injury Disaster Loans (EIDL)
This is a loan, available to all 501(c)s, with an amount determined by the SBA based on the Club’s application. Assuming the club qualifies, interest rates on this loan is set as 2.75%. Within 3 days of application Club will receive a $10,000 grant.
Employee Retention Credit
This is a credit, calculated at 50% of qualified wages up to $10,000 (max credit of $5,000 per employee) paid between March 12, 2020, and December 31, 2020. Depending on your 2019 annual average employee count the credit is calculated for all employees you are paying (under 100 full-time employees) or for employees you are continuing to pay that are not working (over 100 full-time employees). The credit is applied against your quarterly 941 filings. If your quarterly payment is insufficient to cover the credit you can apply for a refund or advance payment via IRS Form 7200.
Payroll Tax Deferral
This is a deferral of cash payments for the employer portion of the social security tax incurred between March 27, 2020 and December 31, 2020. The amount due and not paid in that period is due at 50% by December 21, 2021 and 50% by December 31, 2022.
All three of these provisions can be enjoyed simultaneously. Participating in one does not preclude you from the other two.