University of Southern California


How Much Can A Subcontractor Charge For Indirect Costs?

Except if the awarding federal program is subject to a reduced F&A rate (e.g., statutory or regulatory F&A reduction or exception granted by the federal agency head), USC will honor the subrecipient’s approved indirect cost rate negotiated between the subrecipient and the federal government.  If no such rate exists, USC will approve indirect costs at the de minimis rate of 10% Modified Total Direct Costs.

A subrecipient can voluntarily opt to forego F&A, but will need to document that they are choosing to forego their de minimus 10% F&A voluntarily.