When employees suffer tragedy, employers often want to help. Such help, when directed at a particular person or situation, is kind and generous but not deemed by the IRS as a “charitable” act which qualifies for a tax deduction. We have developed a tax-deductible, streamlined solution called an Employee Hardship Fund.
Employee Hardship Funds allow you to respond in an objective, systematic, and confidential manner to help employees get through difficult situations when a little bit of extra cash can make all the difference.
An Employee Hardship Fund is easy to establish and can be supported through tax-deductible payroll deductions and other employer and employee contributions. Once established, the Community Foundation of Greater Huntsville does all the work – from promoting the fund to your employees, accepting and reviewing the applications for assistance, and making the payments.
A Win-Win
Employer and employee contributions to the fund are tax-deductible
Assistance grants to the employees are not taxable to the employee as income
Employee Hardship Funds provide a consistent, impartial, and confidential means of hardship assistance
Employees facing hardships apply directly to the Community Foundation to request assistance from the Fund
The Community Foundation handles all aspects of application review, approval, and grant payments so that you can focus on your business
What Situations Qualify?
Employee Hardship Funds are designed to provide short-term, supplemental emergency support to employees or eligible dependents who are facing serious financial hardship and who cannot afford housing, utilities, and other basic living expenses as a result of certain unforeseen and unpreventable circumstances.
Natural disaster such as flood, hurricane, tornado, wildfire, earthquake, or severe storms that have damaged or destroyed primary residence.
Life-threatening illness or injury including the employee, spouse, and eligible dependent(s). Applicants must demonstrate resulting financial need, including an inability to pay basic living expenses.
Death of the employee or of eligible dependent(s). A Fund cannot pay for travel to funerals or funeral expenses, but can help when the loss of income, cost of funeral expenses, or medical bills prevent an employee of employee’s family from affording basic living expenses.
Other catastrophic or extreme circumstance including but not limited to house fire, major home damage that was unpreventable, serious crime against an employee such as robbery, arson, assault, domestic abuse that impacts the ability to afford basic living expenses.
"The ERC Helping Hands Benevolence fund was started in 2017 after hurricanes Harvey and Irma devasted communities where our employees live and work. This fund enables our employees to take care of each other during times of hardship or tragedy." -Michele Armstrong
How It Works
Company makes a tax-deductible contribution to establish an Employee Hardship Fund within the Community Foundation and specifies eligibility criteria and other term
Employees can also optionally contribute to the Fund through payroll deduction
The Community Foundation educates your team about how the Fund works, including how gifts may be made and how employees can apply
Employees can apply for emergency support to get through financial hardship
The Community Foundation handles all administrative details, processes all applications, and issues all grants to ensure privacy and fairness
