Page Updated: October 29, 2019
In most cases, indirect (also called F&A) costs are calculated using an MTDC base. In some cases, a sponsor will have a published limitation on indirect costs, so we would use a TDC base (Scenario 1). In less frequent cases, a sponsor may require that the indirect costs be limited to a percentage of the total cost of the award (Scenario 2). See examples below.
To determine how much direct costs are allowed, divide total costs by 1.XX where XX is the indirect cost rate expressed as a decimal (e.g. 20% = 0.20).
Total Costs / (1.XX) = Maximum Direct Costs
Direct Costs x F&A rate = F&A Costs
Maximum Direct Costs + F&A Costs = Total Costs
Applicants may request up to $100,000, and the F&A rate is limited to 20% of total direct costs.
$100,000 (total costs) / 1.20 (1.F&A rate) = $83,333.33 (maximum direct costs)
$83,333.33 (direct costs) x 0.20 (F&A rate) = $16,666.67 (F&A costs)
$83,333.33 (direct costs) + $16,666.67 (F&A costs) = $100,000 (total costs)
Calculate your own:
To determine how much may be requested for direct and indirect costs, use the following formulas, with F&A rate % expressed as a decimal (e.g., 20% = 0.20):
Direct Costs / (1.0 - F&A rate %) = Total Award OR Total Award x (1.0 - F&A rate %) = Direct Costs
Total Award x F&A rate % = Indirect Costs
Direct Costs + Indirect Costs = Total Award
Applicants may request up to $100,000 total costs, and the F&A costs may not exceed 20% of costs:
$100,000 (total costs) x (1.0 - 0.20*) = $80,000 (direct costs); *1.0 - 0.20 = 0.80
$100,000 (total costs) x 0.20 = $20,000 (F&A costs)
The F&A rate is limited to 8% of total award, and the PI only needs $40,000 for direct costs:
$40,000 (direct costs) / (1.0 - 0.08*) = $43,478 total award; *1.0 - 0.08 = 0.92
$43,478 x 0.08 = $3,478 (indirect costs)
$40,000 + $3,478 = $43,478 (total costs)
Calculate your own (click below to expand):