Allowable and Unallowable Direct Costs

  • In addition to being allowable, direct costs must follow the usual guidelines of being reasonable, allocable, applicable, and consistently treated and must comply with University policy.
  • Please note that awarding agency guidelines and University policy may be more rigid than the guidelines listed here

Uniform Guidance Ref A-21 Ref Title Allowable as a direct cost Unallowable as a direct cost
200.421 Advertising and Public Relations Costs Allowable only if related to and necessary for performance of the sponsored project (i.e., recruitment of personnel, procurement of goods and services, disposal of scrap/surplus materials, program outreach) See allowable column
J1  Advertising and Public Relations Allowable only if related to and necessary for performance of the sponsored project (i.e., recruitment of personnel, procurement of goods and services, disposal of scrap/surplus materials) Unallowable for promotional items and memorabilia, including models, gifts and souvenirs
200.422 J2 Advisory Councils Allowable for costs incurred by councils or committees when authorized by the awarding agency See allowable column
200.423 J3 Alcoholic Beverages Unallowable Unallowable
200.424 J4 Alumni Activities Unallowable Unallowable
200.425 J5 Audit Costs and Related Services Allowable if specifically required and approved by the awarding agency See allowable column
200.426 J6 Bad Debt Unallowable Unallowable
200.427 J7 Bonding Costs Allowable pursuant to the terms of an award if required for a construction project See allowable column
200.428 Collection of Improper Payments Allowable for costs incurred to recover improper payments  See allowable column
200.429 J8 Commencement and Convocation Costs Unallowable Unallowable
J9 Communication Costs Allowable for costs directly attributable to a specific project (i.e., long distance calls. See also OMB A-21, Section F6) Unallowable for recurring line charges, network charges, local telephone costs, and cell phones
200.430 Compensation - Personal Service Allowable for services such as salaries and wages within University policy and for activities contributing to an intimately related to work under the sponsored agreement See allowable column
200.431 Compensation - Fringe Allowable for services such as fringe benefits within University policy and for activities contributing to and intimately related to work under the sponsored agreement See allowable column
J10 Compensation for Personal Services Allowable for services such as salaries, wages and fringe benefits within University policy and for activities contributing to and intimately related to work under the sponsored agreement See allowable column
200.432 Conferences Allowable when the primary purpose is the dissemination of technical information directly related to the project. This includes costs of meals, transportation, rental of facilities, speakers' fees, other items incidental to such meetings or conferences, and identifying (but not providing) locally available dependent-care resources, but excludes entertainment costs See allowable column
J32 Meetings and Conferences Allowable when the primary purpose is the dissemination of technical information directly related to the project. This includes costs of meals, transportation, rental of facilities, speakers' fees, and other items incidental to such meetings or conferences, excluding entertainment costs See allowable column
200.433 Contingency Provisions Allowable when explicitly included in budget estimates, to the extent they are necessary to improve the precision of those estimates. Amounts must be estimated using broadly-accepted cost estimating methodologies, specified in the budget documentation of the award, and accepted by the awarding agency Unallowable for payments made to a "contingency reserve" or any similar payment made for events the occurrence of which cannot be foretold with certainty as to the time or intensity, or with an assurance of their happening
J11 Contingency Provisions Unallowable Unallowable
200.434 J15 Contributions and Donations Unallowable Unallowable
J12 Deans of Faculty and Graduate Schools Unallowable Unallowable
200.435 J13 Defense and Prosecution of Criminal and Civil Proceedings, Claims, Appeals and Patent Infringement Unallowable Unallowable
200.436 J14  Depreciation and Use Allowances Unallowable Unallowable
200.437 Employee Health and Welfare Costs Unallowable Unallowable
J16 Employee Morale, Health, and Welfare Costs Unallowable Unallowable
200.438 Entertainment Costs Unallowable, except where specific costs that might otherwise be considered entertainment have a programmatic purpose and prior approval has been received from the awarding agency See allowable column
J17 Entertainment Costs Unallowable Unallowable for cost of entertainment including amusement, diversion, and social activities and any costs directly associated with such costs (such as tickets to shows or sports events, meals with inadequate substantiation of business purpose, lodging, rentals, transportation, and gratuities)
200.439 J18  Equipment and other Capital Expenditures Allowable only for special purpose equipment (Prior approval from awarding agency required for items with a unit cost of $5,000 or more)


Special Purpose Equipment - used exclusively for research, medical, scientific, or other technical activities

Unallowable for General Purpose Equipment


General Purpose Equipment - not used exclusively for research (i.e., office equipment and furnishings, reproduction and printing equipment, etc.)

200.440 Exchange rates Allowable for cost increases for fluctuations in exchange rates with prior approval of the awarding agency and the availability of funds See allowable column
200.441 Fines, Penalties, Damages and Other Settlements Unallowable Unallowable
J19 Fines and Penalties Unallowable Unallowable
400.442 J20  Fund Raising and Investment Costs Unallowable Unallowable
200.443 J21 Gain and Losses on Depreciable Assets Unallowable Unallowable
200.444 General Cost of Government Does not pertain to IHE's See allowable column
200.445 Goods or Services for Personal Use Unallowable, except for Costs of housing, housing allowances and personal living expenses when prior approval is received from the awarding agency See allowable column
J22 Goods or Services for Personal Use Unallowable Unallowable
J23  Housing and Personal Living Expenses Unallowable Unallowable
200.446 J24 Idle Facilities and Idle Capacity Unallowable Unallowable
200.447 J25 Insurance and Indemnification Allowable if related to and necessary for the performance of the sponsored project (Note: malpractice insurance is an allowable cost of research programs only to the extent that the research involves human subjects) See allowable column
200.448 Intellectual Property Allowable if required by the sponsored agreement and when necessary for the performance of the sponsored project Unallowable for foreign patents and when the Federal Government has a license or the right to free use of the patent or copyright; or when the patent or copyright has been adjudicated to be invalid, has been administratively determined to be invalid, is considered to be unenforceable, or has expired.
J34 Patent Costs Allowable if required by the sponsored agreement Unallowable for foreign patents
J44 Royalties and Other Costs for Use of Patents Allowable when necessary for the performance of the sponsored project Unallowable when the Federal Government has a license or the right to free use of the patent or copyright; or when the patent or copyright has been adjudicated to be invalid, has been administratively determined to be invalid, is considered to be unenforceable, or has expired.
200.449 J26 Interest Unallowable Unallowable
J27 Labor Relations Costs Unallowable Unallowable
200.450 J28 Lobbying Unallowable Unallowable
200.451 J29 Losses on Other Sponsored Agreements or Contracts Unallowable Unallowable
200.452 J30 Maintenance and Repair Costs Allowable as a direct cost as necessary to carry out the technical and scientific aspects of and actually used for the performance of a sponsored project See allowable column
200.453 Material and Supplies Costs, Including Costs of Computing Devices Allowable as a direct cost when necessary for and actually used for the performance of a sponsored project (office supplies are not allowable) Unallowable for office supplies. Office supplies include copy charges, fax charges, postage/mail room charges, and personal computers unless primarily or exclusively used in the actual conduct of scientific research.
J31 Material and Supplies Costs Allowable as a direct cost when necessary for and actually used for the performance of a sponsored project (office supplies are not allowable) Unallowable for office supplies. Office supplies include copy charges, fax charges, postage/mail room charges, and personal computers unless primarily or exclusively used in the actual conduct of scientific research.
200.454 J33  Memberships, Subscriptions and Professional Activity Costs Unallowable Unallowable
200.455 Organization Costs Allowable for costs in connection with the establishment or reorganization of an organization when prior approval is received from the awarding agency See allowable column
200.456 Participant Support Costs Allowable when prior approval has been received from the awarding agency See allowable column
200.457 J35 Plant and Security Costs Allowable under special circumstances and/or if required by the awarding agency See allowable column
200.458 J36 Pre-award Costs Allowable with prior approval from the awarding agency See allowable column
200.459 Professional Service Costs Allowable when in accordance with Uniform Guidance section 200.459 b & c and in accordance with University policy Unallowable for officers or employees of the institution
J37 Professional Service Costs Allowable when in accordance with OMB A-21, J37 b & c and in compliance with University policy Unallowable for officers or employees of the institution
200.460 J38 Proposal Costs Unallowable Unallowable
200.461 Publication and Printing Costs Allowable if the costs can be identified with a research project. If the cost is for page charges, the charges are allowable for professional journals if the work is supported by the Federal Government and the charges are levied impartially on all research papers published, not just those funded by federally sponsored authors. Costs incurred for publication of research results after the period of performance can be charged during the closeout period but no later than 15 days prior to the end of the closeout period. See allowable column
J39 Publication and Printing Costs Allowable if the costs can be identified with a research project. If the cost is for page charges, the charges are allowable for professional journals if the work is supported by the Federal Government and the charges are levied impartially on all research papers published, not just those funded by federally sponsored authors See allowable column
200.462 Rearrangement and Reconversion Costs Allowable with prior approval of the awarding agency when incurred specifically for the sponsored project and for costs incurred in the restoration or rehabilitation of the institution's facilities to approximately the same condition existing immediately prior to commencement of awards, less costs related to normal wear and tear Unallowable for ordinary rearrangement and alteration of facilities and normal wear and tear
J40 Rearrangement and Alteration Costs Allowable with prior approval of the awarding agency when incurred specifically for the sponsored project Unallowable for ordinary rearrangement and alteration of facilities.
J41 Reconversion Costs Allowable for costs incurred in the restoration or rehabilitation of the institution's facilities to approximately the same condition existing immediately prior to commencement of a sponsored agreement (fair wear and tear excepted) only with prior approval of the sponsoring agency and when incurred specifically for the sponsored project. Unallowable for normal wear and tear
200.463 Recruiting Costs Allowable when related to and necessary for the project and if reasonable (color ads are not considered reasonable - see Uniform Guidance 400.421). Short-term travel visa costs when issued for a specific period and purpose. See allowable column
J42 Recruiting Costs Allowable when related to and necessary for the project and if reasonable (color ads are not considered reasonable - See OMB A-21, Section J1) See allowable column
200.464 Relocation Costs of Employees Allowable for employment of 12 months or longer and must follow the current University policy Unallowable
J42 Relocation Costs Allowable for employment of 12 months or longer Unallowable
200.465 Rental Costs of Buildings and Equipment Allowable for reasonable costs (subject to the limitations on leases given in the Uniform Guidance, Section 200.465 a-c6) when incurred specifically for the sponsored project. The rental cost of any property owned by any individual or entities affilliated with Michigan Tech, including home office space is unallowable See allowable column
J43 Rental Costs of Buildings and Equipment Allowable for reasonable costs (subject to the limitations of leases given in OMB A-21, Section J43 a-d) when incurred specifically for the sponsored project. See allowable column
200.466 Scholarships and Student Aid Costs Allowable only when the purpose of the sponsored agreement is to provide training to selected participants and the charge is approved by the sponsoring agency.  In order to pay tuition, a stipend must be paid, and the student must be enrolled in an advanced degree program.  The activities of the student in relation to the project must be related to the degree program and compensation must be conditioned explicitly on their performance of the work.  Must be a bona fide employer-employee relationship (see Uniform Guidance, Section 200.466) See allowable column
J45 Scholarships and Student Aid Costs Allowable only when the purpose of the sponsored agreement is to provide training to selected participants and the charge is approved by the sponsoring agency. In order to pay tuition, a stipend must be paid, and the student must be enrolled in an advanced degree program. The activities of the student in relation to the project must be related to the degree program and compensation must be conditioned explicitly on the performance of the work. Must be a bona fide employer-employee relationship (see OMB A-21, Section J45). See allowable column
200.467 Selling and Marketing Costs Unless allowable under Advertising and Public Relations, only allowable when necessary for the performance of the award See allowable column
J46 Selling and Marketing Unallowable Unallowable
200.468 Specialized Service Facilities Allowable, but rates must comply with Uniform Guidance, Section 200.468 and University policy. See allowable column
J47 Specialized Service Facilities Allowable, but rates must comply with OMB A-21, Section J47 and University policy See allowable column
200.469 J48 Student Activity Costs Unallowable Unallowable
200.470 Taxes (Including Value Added Tax) Allowable when the institution is required to pay See allowable column
J49 Taxes Allowable when the institution is required to pay See allowable column
200.471 Termination Costs Allowable for costs which would not have arise had the sponsored agreement not been terminated, provided they meet the requirements of the Uniform Guidance, Section 200.471 See allowable column
J50 Termination Costs  Allowable for costs which would not have arisen had the sponsored agreement not been terminated, provided they meet the requirements of OMB A-21, Section J50 See allowable column
200.472 Training and Education Costs Allowable for training and education provided for employee development for a specific sponsored project. See allowable column
J51 Training Costs Allowable for training provided for employee development for a specific sponsored project. See allowable column
200.473 J52 Transportation Costs Allowable when related to goods purchased See allowable column
200.474 Travel Costs Allowable for transportation, lodging, subsistence, temporary dependant care and related items for employees who are in travel status on project-specific business, subject to University policy Non-employee travel is unallowable unless related to Uniform Guidance, Section 200.422 or specifically required to fulfill the requirements of the solicitation.
J53 Travel Costs Allowable for transportation, lodging, subsistence and related items for employees who are in travel status on project-specific business, subject to University policy Non-employee travel unallowable unless related to OMB A-21, Section J2 or specifically required to fulfill the requirements of the solicitation.
200.475 J54 Trustees Unallowable Unallowable