The key thing to remember about a CARES loan under the Paycheck Protection Program is that it is “forgivable” and becomes entirely a grant if the organization maintains its employment at least at 75% of the level prior to the pandemic.  If you are getting a grant for the entire cost of the payroll, you can probably continue to pay the employees for the eight weeks required under the rules.  Ultimately, it is up to you whether to apply, but it is designed to keep workers on the payroll and give smaller nonprofits the ability to do so.  If it is not fully forgiven, the interest rate is one percent and the note is due in two years.  You should determine whether the risk is appropriate.

The SBA “Final Interim Rule” makes clear that a employer filing for a CARES loan may not include the cost of independent contractors who receive an IRS Form 1099 from the employer to confirm their earnings.  Independent contractors are allowed to apply for their own direct loans under the program.