Indirect Cost Policy

Indirect costs are general overhead and administration expenses that support the entire operations of a grantee and that may be shared across projects. Examples of indirect costs include the salary and related expenses of individuals working in rent, utilities, equipment and services such as accounting, IT and legal. Indirect costs are not normally charged directly to a Federal award, but are allocated equitably to all of the organization’s activities. Expenses that would be incurred regardless of whether the grant is funded are often indicative of indirect costs. While these costs may not be directly attributable to a project, they are real and necessary to operate as an organization.


Indirect cost rates for grants are subject to the following limitations:

0% rate: government agencies or colleges/university

Up to 10% rate: independent non-profit organizations (501c3) or non-profit organizations with fiscal sponsor status

A grantee or contractor with an actual indirect cost rate lower than the maximum rate provided above should not increase the funding request to the maximum allowed.

The potential grantee should communication with the Alliance in advance of submission if there are questions or concerns about the indirect cost rate.

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