Grant Writing

Building Your Grant Budget: Indirect Costs or Facilities and Administrative Costs (F&A)

Indirect costs represent the expenses of doing research that are not readily identified with a specific activity but are necessary to the general operation of the project. To be blunt, indirect costs are anything that is not a direct cost, such as: heat, light, or accounting. In general, indirect costs are calculated as a percentage to determine the proportion of departmental organizational costs each project should bear. This will allow for each project represented in the direct costs base to assume their fair share of indirect costs when the rate is applied.

  • Indirect Costs avoid burdensome and impractical tracking of items or services that support the general research enterprise. They are calculated as a percentage of direct costs and are awarded in addition to direct costs.
  • When preparing a proposal, read the instructions carefully to determine whether indirect costs ARE or ARE NOT included in the budget limit.
  • Your institution likely negotiates its federal rate annually. Only Research Administration, in consultation with other administrators, may waive or lower this rate for individual proposals. It is never negotiated with a funding agency during the competitive review process.
 Foundation 1Foundation 2Foundation 3Federal
Indirect costs10%20%0%50%
SalaryCapped at $200,000No cap; but only 25% of budget may be spent on salariesNo PI or other investigator salary, but support staff OKCapped at $183,300 for HHS agencies
Supplies Office supplies OKNo supplies allowedNot mentionedOffice supplies not OK
Equipment Equipment OKEquipment not allowedEquipment OKEquipment OK; defined as $5000 per item
MatchingInstitution must match 1:1No match requiredInstitution must match PI effort 1:1Rarely required, but must be tracked if committed
Payment100% up frontCost reimbursable2 payments; second payment dependent on progressUsually cost-reimbursable

Further Reading

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