Key Information for Pastors and Churches from Pensions and Benefits USA – COVID-19

The threat of COVID-19 is affecting pastors and congregations across the United States as churches respond to guidelines prohibiting the physical gathering of persons for activities, including worship. As members of local churches in the Kansas City area, the staff of Pensions and Benefits USA are aware of the many hardships this pandemic is creating, including the downturn of income that is affecting most churches. While we cannot do a lot beyond continuing the benefits, services, and plans we normally provide, we have been studying the CARES Act for useful information. The following items represent highlights of our research that may be helpful to you and/or your congregation.

SBA Loans Available to Churches

The recently enacted CARES Act makes SBA Loans available to churches under what’s called the Paycheck Protection Program (PPP). Churches may borrow up to two and a half times the amount of their average payroll costs over the past 12 months. These funds may be used for:

  • Payroll expenses, including wages and benefits;
  • Rent or interest expense on debt; and
  • Utilities.

These loans are:

  • Obtained through a local SBA-approved lender/bank;
  • Unsecured; no board/personal guarantees or mortgages; and
  • 100% forgiven if the proceeds are used for the above-noted types of expenditures within eight weeks of their receipt (other limitations apply).

The Global Ministry Center has prepared this Guidelines for Cares Application. This document from the accounting firm of Batts Morrison Wales & Lee provides a good overview of the PPP, including what is covered. The SBA has provided a FAQ on the PPP for faith-based institutions, and the Church Alliance has created this FAQ.

403(b) Withdrawals

The CARES Act makes provision for temporary changes in some retirement plans. Pensions and Benefits USA is currently evaluating these options with legal counsel; however, at this time, it is unknown if these will be incorporated into the Nazarene 403(b) Retirement Savings Plan.

Retirement Investing

Persons around the nation have been affected by fluctuations in the stock markets. While these can be scary, this is not a good time to be removing money from one’s 403(b) Retirement Savings Plan account—unless you absolutely need it to live. Traditionally, there is an ebb and flow to the markets, and we believe better days are ahead if we’re patient.

Fidelity Investments has collected a variety of valuable resources that are available here. A free on-demand Fidelity workshop, Navigating Market Volatility, is available here.


The IRS created a special landing page that provides information specifically related to tax rules that are affected by the federal government in the wake of COVID-19. You’ll find it here. Here are a few key items that apply to ministers that have been implemented either by congressional action, or changes to the IRS code:

  • Extension of the filing date for federal income tax from April 15 to July 15, 2020. Note that this applies to federal taxes only. For state or local government filing deadlines, check with your local and state taxing authorities.
  • The new legislation allows both employers and employees to defer the 6.2% tax each pay on wages to Social Security. The next payment normally would be due April 15, 2020. Under the new guidelines, if deferred, the SE tax would have to be paid over the following two years—half by 12/31/21; the other half by 12/31/22. Note that churches taking advantage of the Paycheck Protection Program may not defer these payments.

Charitable Contributions

The CARES Act allows for an above-the-line deduction for charitable contributions made in cash of up to $300 for those who do not itemize their tax returns. Additionally, the bill lifts the limitation for individual charitable deductions and increases the corporate percentage limitation to 25% for 2020.

Stimulus Checks

The legislation also provides monetary assistance to eligible individuals, which means anyone who is a legal resident and is not claimed (or eligible to be claimed) as a dependent on someone else’s tax return. There are income limits which may reduce or eliminate the level of this benefit. Learn more at the IRS link.

Student Loans

The CARES Act provides several benefits regarding student loans, including help to manage your money due to the coronavirus emergency. Among other benefits, the new law provides:

  • Ability to pause payment on federal student loans until September 30, 2020.
  • No interest on federal student loan payments through September 30, 2020.
  • Stops garnishment of wages, Social Security and tax refunds for student loan debt collection.

The Student Loan Borrower Assistance Project (SLBA) website has more information at this link.

Other Resources

  • Information from the Evangelical Council for Financial Accountability (ECFA).
  • Details about PPP and faith-based organizations from the accounting firm of CapinCrouse, LLP.
  • Key Highlights of the CARES Act from Richard Hammar's Church Law and Tax.

For Assistance

Members of the Pensions and Benefits USA staff are operating remotely to seamlessly continue supporting the benefits and services we provide for active and retired ministers, spouses, widows, and other church employees. We are available to assist Monday – Friday from 8:00 A.M. to 4:30 P.M. (CT). If you have questions, please contact us at

Note: This material is provided for informational purposes only. Pensions and Benefits USA does not provide legal or tax advice and does not endorse private or federal lending programs. We encourage churches to seek professional assistance from trusted legal/tax advisors.