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The initial guidance on when Higher Education Emergency Relief Funds were to be spent was along the lines of, “promptly and to the greatest extent practicable… by one year from the date” of the recipient institution’s “Certification and Agreement” for the funds.  Now, ED has issued new guidance on how long institutions have to spend the HEERF funds.

 

SITUATION

Marathon Bible College (MBC) is a private college exempt under Internal Revenue Code section 501(c)(3) and 170(b)(1)(A)(ii).  They are required to file Form 990 annually.

MBC received CARES Act Section 18004(a)(1) amounts (Student portion and Institutional portion).  They were included in the allocations list for Section 18004(a)(3) amounts, but have not yet heard anything about when they might receive those allocations.

They called us to ask about HEERF payments.

“When can we expect to receive the Section 18004(a)(3) or “FIPSE” amounts?”

“Well,” we told them, “we are not sure at this point.  ED has stated informally that, ‘Revisions are currently being made to the formula allocation table and methodology for the CARES Act 18004(a)(3) FIPSE funding.  We will be announcing more details in the coming weeks.’  That was a few weeks ago.”

“Okay,” said the MBC team.  “What about guidance on when the HEERF funds must be spent?”

“That we can help with.  ED released new ‘Supplemental FAQs’ recently.  They state that HEERF funds must be spent by September 30, 2022.  However, ED urges institutions to disburse the ‘student’ funds immediately.  And, all the various types of HEERF funds must be spent in accordance with the ‘Certification and Agreement’ that was signed by each institution for each type of HEERF payment.”

 

RULES

From Department of Education, “Higher Education Emergency Relief Fund Supplemental Frequently Asked Questions under Section 18004 of the Coronavirus Aid, Relief, and Economic Security (CARES) Act”:

  1. What is the deadline for institutions to spend Higher Education Emergency Relief Fund (HEERF) funds received under the CARES Act?

Institutions must spend HEERF funds by September 30, 2022, but as Congress required that institutions use at least 50 percent of the funds provided under Section 18004(a)(1) of the CARES Act for emergency financial aid grants to students pursuant to Section 18004(c), the Department urges institutions to disburse immediately emergency financial aid grants to those students who were enrolled during the spring term (or during quarters that include the national emergency period). If funds for emergency financial aid grants to students remain after the institution assists such students using its distribution formula, the institution may use the remaining funds to provide emergency financial aid grants to students during the summer or fall terms, using the same distribution formula.

 

BOTTOM LINE

  • Higher Education Emergency Relief Fund (HEERF) “funds” are authorized by law in CARES Act Section 18004.
  • There are basically three subsections (18004(a)(1), (a)(2), and (a)(3)) that result in four “flavors” of HEERF funds.
  • The Department of Education has released “HEERF Supplemental FAQs” that can be found at:  https://www2.ed.gov/about/offices/list/ope/caresactsupplementalfaqs61620.pdf
  • We are still awaiting further information about Section 18004(a)(3) funds that are very important to many Bible colleges and seminaries.  But, currently, it’s “crickets” from ED.

Specific questions? Email Dave Moja

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