Overhead Policy

The maximum allowable indirect cost rate for nonprofit organizations is 20% of the total approved direct costs. For universities and units of government, the maximum allowable rate is 12.5%.

Indirect costs are defined as expenses not directly tied to a specific project but shared across multiple projects. These costs are typically incurred for the organization’s overall support and management activities. Examples of indirect costs include administrative salaries, utilities, rent, office supplies, and general organizational overhead.