---
kind: "section"
citation: "34 C.F.R. § 75.563"
title: "34"
number: "75.563"
heading: "Restricted indirect cost rate or cost allocation plans—programs covered."
url: "https://uscodex.org/cfr/34/75.563"
---

# §75.563. Restricted indirect cost rate or cost allocation plans—programs covered.


If a grantee or subgrantee decides to charge indirect costs to a program that is subject to a statutory prohibition on using Federal funds to supplant non-Federal funds, the grantee must—

- (a) Use a negotiated restricted indirect cost rate or restricted cost allocation plan compliant with [34 CFR 76.564 through 76.569](/cfr/34/76.564..76.569.md); or
- (b) Elect to use an indirect cost rate of 8 percent of the modified total direct costs (MTDC) base if the grantee or subgrantee does not have a negotiated restricted indirect cost rate. MTDC is defined in [2 CFR 200.1](/cfr/2/200.1.md). If the Secretary determines that the grantee or subgrantee would have a lower rate under [34 CFR 76.564 through 76.569](/cfr/34/76.564..76.569.md), the lower rate must be used on the affected program.
- (c) If the grantee has established a threshold for equipment that is lower than the amount specified in the Uniform Guidance, the grantee must use that threshold to exclude equipment from the MTDC base.
- (d) For purposes of the MTDC base and application of the 8 percent rate, MTDC includes up to the amount specified in the definition of MTDC in the Uniform Guidance of each subaward, each year.

## Notes

### Amendments

[89 FR 70330, Aug. 29, 2024]

### Authority

Authority: 20 U.S.C. 1221e-3 and 3474, unless otherwise noted. Section 75.263 also issued under 2 CFR 200.308(e)(1). Section 75.617 also issued under 31 U.S.C. 3504, 3505. Section 75.740 also issued under 20 U.S.C. 1232g and 1232h.

### Source

Source: 45 FR 22497, Apr. 3, 1980, unless otherwise noted. Redesignated at 45 FR 77368, Nov. 21, 1980.

### Amendments

[89 FR 70330, Aug. 29, 2024]