December 4, 2020
Note: The North Carolina Center for Nonprofits typically provides Nonprofit Policy Update each week as a benefit to its nonprofit members. However, to help all North Carolina nonprofits respond to the COVID-19 pandemic, we're temporarily providing this newsletter to non-member nonprofits.
In this issue...
Contact your members of Congress today to demand COVID-19 relief for nonprofits
Congress may consider including COVID-19 relief in year-end spending bill
Spread the word: Low-income families can still apply for Extra Credit Grants through Monday
Learn the latest on legal compliance for nonprofits next Tuesday
Be alert for unemployment fraud involving your nonprofit’s account
CARES Act provisions may affect year-end giving 
Holiday season advocacy tip: Introduce your nonprofit to newly-elected officials 
Take 2 minutes to share your nonprofit’s role in historic election turnout
Annual Legal Compliance Checklist now available
Contact Your Members of Congress Today to Demand COVID-19 Relief for Nonprofits
With COVID-19 cases surging and much of the support from the CARES Act ending later this month, communities are relying even more heavily than usual on nonprofits to provide essential services. Without additional federal COVID-19 relief, many organizations will not be able to continue to weather the financial strain of the pandemic. North Carolina’s members of Congress need to hear from nonprofit leaders about the urgency of passing a COVID-19 relief package to help nonprofits, individuals, businesses, and communities.

Please take a few minutes to contact your U.S. Representative and Senators Richard Burr and Thom Tillis to urge Congress to pass a COVID-19 relief bill that includes the nonprofit sector's #Relief4Charities priorities. We’ve made it easy by providing sample tweets and email language you can use or adapt, as well as contact information for our U.S. Senators and Representatives. You can also post additional tweets using the #Relief4Charities hashtag, expressing why your nonprofit and the people you serve need additional relief now. 

Thank you if your organization already took action earlier this week!
Congress May Consider Including COVID-19 Relief in Year-End Spending Bill
Earlier this week, a bipartisan group of U.S. Senators and U.S. Representatives – none of whom are from North Carolina – announced a proposal for a $908 billion COVID-19 relief package. This proposal has renewed hopes that Congress may include additional COVID-19 relief in the spending bill that it must pass to prevent a partial shutdown of the federal government on December 11.

The nonprofit sector continues to ask Congress to pass COVID-19 relief that includes several important provisions to help charitable organizations and the communities they serve:

  • Expanding Nonprofit Access to Relief and Support. Nonprofits are struggling financially and are facing ever-growing challenges in continuing to provide essential services to our communities. Congress can help by: 
  1. Expanding the eligibility for charitable nonprofits to participate in the Paycheck Protection Program (PPP) by modifying the current 500-employee cap so that mid-size and larger nonprofits can participate, and modify the PPP so that charitable nonprofits can participate in a second round of funding.
  2. Expanding the Employee Retention Tax Credit (ERTC) and allowing nonprofits to receive both PPP loans and the ERTC if they have retained their employees.

  • Strengthening Incentives for Charitable Giving. Donations are especially necessary today as nonprofits respond to the current health and economic crisis and will be critical in the future as nonprofits play an essential role in recovery efforts when the pandemic ends. Congress can help by: 
  1. Encouraging donations to charitable organizations in their communities by significantly increasing the $300 cap in the above-the-line or universal charitable deduction in the CARES Act.
  2. Extending the giving incentives in the CARES Act – including the universal charitable deduction and incentives for corporations and wealthier donors to give more – through at least 2021.

  • Increasing and Extending Federal Unemployment Insurance Reimbursement for Self-Insured Nonprofits. The CARES Act provides federal funds to cover 50% of the COVID-related unemployment costs of self-insured nonprofits through December 30, 2020. North Carolina is covering the other half these costs for nonprofits in our state at least through the end of 2020, but nonprofits in many parts of the country are still bearing a huge financial burden from unemployment claims caused by unforeseeable layoffs and furloughs stemming from the pandemic. Congress can help address this issue by:
  1. Increasing to 100% the federal unemployment insurance reimbursement for self-insured nonprofits.
  2. Extending this reimbursement through 2021.

  • Extending Unemployment Benefits. The Pandemic Unemployment Assistance program – which provides unemployment benefits to self-employed individuals and laid-off or furloughed workers at small and religious nonprofits that are exempt from unemployment requirements – is set to expire on December 30, 2020, along with several other temporary expansions of unemployment benefits. Congress can help communities by extending these programs into 2021 and by restoring weekly supplemental unemployment benefits for most laid-off or furloughed workers.

  • Providing Additional Aid for State and Local Governments. This additional funding is critical to help state and local governments continue to provide essential services despite growing revenue shortfalls.

  • Including Nonprofits in Liability Protections. Any provisions limiting businesses’ liability for reasonable actions during the pandemic also must apply to nonprofits and their board members and volunteers.
Spread the Word: Low-Income Families Can Still Apply for Extra Credit Grants
Thanks to the effective advocacy of the nonprofit Charlotte Center for Legal Advocacy, many low-income families in North Carolina will get a second chance to apply for the Extra Credit Grant Program. In September, the NC General Assembly approved the Extra Credit Grant Program, which provides $335 payments to help taxpaying families with children pay for virtual schooling and child-care costs during the COVID-19 pandemic.

While most taxpayers received these payments automatically, low-income families that did not file a 2019 state tax return had to apply to the NC Department of Revenue (DOR) to receive their $335 payments. The original deadline for applications was October 15, but low-income families now have a second chance to apply through next Monday, December 7 at 2 p.m. Families can check their eligibility and apply for grants at Applications are relatively simple, only requiring taxpayers to list their names, SSNs, contact information, and their children’s names, ages, and SSNs. The Charlotte Center for Legal Advocacy has prepared answers to many frequently asked questions about the Extra Credit Grants.

The Center strongly encourages nonprofits serving low-income North Carolinians to help spread the word to ensure that those who did not file a 2019 tax return submit their applications by mail or online before the December 7 deadline.
Learn the Latest on Legal Compliance for Nonprofits on December 8
As nonprofits’ operations have changed during the pandemic this year, many organizations have encountered new and challenging legal compliance and liability issues. To help your nonprofit better understand its legal options both now and in the future, the Center is offering the (virtual) 2020 Legal Update for North Carolina Nonprofits next Tuesday, December 8 from 9 a.m.-3 p.m. This workshop is part of the 2020 Conference for NC Nonprofits.

The workshop will begin with a one-hour overview of important laws for 501(c)(3) nonprofits and include an “Q and non-A” session to help address participants’ legal questions. Breakout sessions will include the latest on operational considerations during the pandemic, trends in employment laws affecting nonprofits, changes to state tax laws, ways the new NC collaborative law statute can help nonprofits with dispute resolutions, and board governance basics.

Register now for the 2020 Legal Update or for the full conference (December 8-10).
Be Alert for Unemployment Fraud Involving Your Nonprofit’s Account
With more than 1.3 million North Carolinians having filed for unemployment benefits since the beginning of the pandemic, it is no surprise that some nonprofits are beginning to discover fraudulent claims against their unemployment insurance (UI) accounts. If your nonprofit receives a Request for Separation Information from the Division of Employment Security (DES) at the NC Department of Commerce about a UI benefits claim from someone who was not employed by your nonprofit or who is still working for your organization, you can report this to DES in three ways:
  1. Through the Fraud Hotline (984-465-9224); 
  2. Through an online fraud reporting form on the DES website; or 
  3. By logging in to your nonprofit’s account at the DES employer portal and clicking on Claims Services ->Unemployment Claims Application and Services ->Submit Tip/Lead and completing Section A and identifying that the claimant never worked for your organization as the reason for possible unemployment insurance fraud (using the “Other activity that caused you to make this report” option).  

DES will investigate possible claims of UI fraud to help ensure that your nonprofit’s account is not charged for fraudulent claims – regardless of whether you pay state unemployment tax or are a reimbursing employer.

Even though the state of North Carolina is not charging reimbursing nonprofits for the costs of their UI claims stemming from COVID-19, DES is sending statements of claims to reimbursing nonprofits that furloughed or laid off staff during the pandemic. It is important for your nonprofit to check these statements to ensure that all claimants listed actually worked for your nonprofit.
CARES Act Provisions May Affect Year-End Giving
Two temporary provisions in the CARES Act may help some nonprofits with year-end fundraising campaigns:
  1. The CARES Act provides for a $300 above-the-line deduction for taxpayers who use the standard deduction. While many North Carolinians give generously to nonprofits regardless of whether they receive a tax benefit, this temporary universal charitable deduction may encourage some people in your community who do not typically donate to nonprofits to make up to $300 in charitable contributions this year.
  2. For wealthy donors who itemized their deductions, the CARES Act temporarily eliminates the 60% of adjusted gross income cap on deductible charitable contributions. For example, a taxpayer with $1 million in adjusted gross income would normally only be able to deduct $600,000 in charitable contributions, but this year, they could deduct $1 million in contributions. This means that these donors may have a tax incentive to make significantly larger charitable contributions this year or to pay the full amount of a multi-year pledge to a nonprofit before December 31, 2020.

Your nonprofit may want to consider reminding potential donors of these tax provisions in any year-end fundraising appeals you are sending.
Holiday Season Advocacy Tip: Introduce Your Nonprofit to Newly-Elected Officials
Now is a great time for nonprofits to get to know your new representatives in Congress, the state legislature, your county board of commissioners, and other elected offices that are important to your organization’s work. It is important for elected officials to understand the important work that your nonprofit does in your community so they can make decisions that will improve the lives of the people your nonprofit serves.

If your nonprofit is sending out holiday cards this year and you have a new member of Congress or the state legislature, consider adding them to your mailing list. Our three new members of Congress are Deborah Ross (serving the 2nd District), Kathy Manning (serving the 6th District), and Madison Cawthorn (serving the 11th District). The NC General Assembly has posted lists of newly-elected state representatives and state senators.
Take 2 Minutes to Share Your Nonprofit’s Role in Historic Election Turnout
This fall’s election showed the power of nonprofits’ nonpartisan voter registration, voter education, and get-out-the-vote work. These efforts helped produce a record high – 75.32% of registered voters cast their votes during Early Voting, on Election Day, or through mail-in absentee ballots. Overall, a record 5.5 million North Carolinians voted in this year’s election. 

The Center encourages your nonprofit to take two minutes to share your nonprofit’s experiences and successes with Nonprofit VOTE, a national partner of the Center, by completing the 2020 Nonprofit Voter Engagement Survey. Your feedback will help Nonprofit VOTE better serve your nonprofit and develop strategies to “voterize” nonprofits in 2021.
Annual Legal Compliance Checklist Now Available
Updated and released annually by the Center, the 2020 Legal Compliance Checklist for North Carolina Nonprofits is a comprehensive resource that outlines a wide variety of federal and state laws that affect North Carolina nonprofits’ governance, finances, advocacy, human resources, and fundraising. This year’s edition includes details on legal issues related to COVID-19, new state tax laws, and changes to employment laws.

If your nonprofit is a member of the Center, you can download the checklist as part of membership. If your nonprofit is not currently a member of the Center, you can purchase the checklist or join the Center to get access.
Not a Center Member? Join now.

Nonprofit Policy Update is a weekly newsletter for current members of the North Carolina Center for Nonprofits. We track state and federal policy issues that affect all 501(c)(3) nonprofits. Learn about the Center's public policy priorities. For more information, contact David Heinen, Vice President for Public Policy and Advocacy.