Free tool
Indirect Cost Calculator
Compute the MTDC base, indirect amount, and total proposal budget for a federal grant. Use the 10% de minimis default, your Negotiated Indirect Cost Rate Agreement (NICRA), or a custom rate for foundation caps. Free, no signup, math runs in your browser.
- Total direct costs
- $200,000
- MTDC exclusions
- $0
- MTDC base
- $200,000
- Rate applied
- 10.0%
- Indirect amount
- $20,000
- Indirect as % of total
- 9.1%
- Total proposal budget
- $220,000
How indirect cost math actually works
Indirect costs are the parts of running an organization that can't be tied to one specific project — rent, utilities, accounting, IT, executive salaries. Federal grants let you recover a portion of those costs by applying an indirect cost rate to a defined cost base. The base is almost always Modified Total Direct Costs (MTDC), not your full direct cost total.
The math is simple in shape:
- Total your direct costs.
- Subtract MTDC exclusions to get the MTDC base.
- Multiply the MTDC base by your indirect rate to get the indirect amount.
- Add direct costs + indirect amount to get the total proposal budget.
What trips people up is step 2 — knowing what counts as an MTDC exclusion. Apply the 10% rate to a $200,000 budget that includes $50,000 in equipment over $5,000, and you should be charging indirect on $150,000 ($15,000), not $200,000 ($20,000). The calculator above handles this automatically.
Should I use de minimis or negotiate a NICRA?
The 10% de minimis rate is the federal default. It exists because filing a NICRA cost proposal is genuinely expensive in staff time, and the OMB Uniform Guidance recognizes that smaller organizations shouldn't be forced through it.
Negotiate a NICRA if (a) your actual indirect costs as a percentage of MTDC are meaningfully higher than 10%, and (b) your federal funding volume is large enough that the additional recovery covers the cost of the negotiation. A rough rule of thumb: if you're below ~$300,000 in annual federal awards, the de minimis rate usually wins on simplicity. Above that, run the numbers.
One more thing: foundations frequently cap indirect cost recovery below your federal NICRA — sometimes at 10%, 15%, or zero. This is policy, not negotiation. When applying to a foundation with an indirect cap, use the cap rate in the calculator above (set the rate type to “Custom”).
What MTDC excludes (and why)
MTDC excludes a defined list of items because applying an indirect rate to large pass-through costs would inflate overhead recovery beyond what the indirect rate actually represents. The exclusions are:
- Equipment costing over $5,000 per unit.
- Capital expenditures (buildings, building improvements).
- Patient care charges.
- Rental costs.
- Scholarships and tuition payments.
- Participant support costs (stipends, subsistence allowances).
- The portion of any subaward over $25,000. (The first $25,000 of each subaward is in MTDC; everything beyond it is excluded.)
For non-federal funders, the exclusion list may differ — some community foundations exclude even less, some private funders exclude more. When in doubt, follow the funder's written instructions and the federal Uniform Guidance.
Frequently asked questions
What is the 10% de minimis indirect cost rate?
The 10% de minimis rate is the federal default indirect cost rate any nonprofit can use on federal awards if it has never had a Negotiated Indirect Cost Rate Agreement (NICRA). Created by 2 CFR 200, it lets smaller organizations skip the cost-proposal paperwork. The 10% is applied to the Modified Total Direct Costs (MTDC) base, not to the full direct cost total.
What does MTDC actually exclude?
Modified Total Direct Costs excludes equipment costing over $5,000 per unit, capital expenditures, patient care charges, rental costs, scholarships and tuition payments, participant support costs, and the portion of any subaward above $25,000 (the first $25,000 of each subaward is included in MTDC; everything above $25,000 is excluded). These exclusions exist because applying an indirect rate to large pass-through costs would inflate overhead recovery beyond what the indirect rate actually represents.
Should I use de minimis or negotiate a NICRA?
Negotiate a NICRA if your real indirect costs exceed 10% of MTDC and you'll receive enough federal funding for the paperwork to pay off. The negotiation requires submitting a cost proposal documenting actual indirect costs against the MTDC base. Most established nonprofits land between 10% and 35%. Below ~$300,000 in annual federal awards, the de minimis rate usually wins on simplicity.
Why do some foundations cap indirect costs lower than my federal rate?
Many private foundations cap indirect cost recovery at 10–15%, sometimes at zero, regardless of your federal NICRA. This is policy, not math. When applying to a foundation with an indirect cap, use the cap rate in this calculator. Some funders also define 'overhead' more narrowly than federal indirect, so always read the funder's specific definition.
Is this calculator official guidance?
No. This is a free tool to help you sanity-check your math. The authoritative source is 2 CFR 200 (the OMB Uniform Guidance) and your awarding agency's specific rules. For a real federal proposal, your finance team or grants accountant should review the budget. We built this calculator because we found ourselves doing the math by hand too often; we're sharing it for the same reason.
From budget math to a winning proposal
The calculator handles the indirect cost math. GrantMind handles the rest of the proposal: drafting all nine sections, scoring the draft 0–100 against the funder's rubric, and tracking every deadline and report through to funded dollars.
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Disclaimer: This calculator is a planning aid, not authoritative guidance. The authoritative source for federal indirect cost rules is 2 CFR 200 (OMB Uniform Guidance) and your awarding agency's specific rules. Confirm any indirect cost calculation with your finance team or grants accountant before submitting a federal proposal.