Indirect Cost Allocation Plan
Auditors ask to see your written cost allocation plan. Most organizations don't have one. This is a complete, fill-in-the-blank template built around 2 CFR 200 Subpart E — add your rate, adjust the pools, and adopt it.
"Our auditor asked for the cost allocation plan and we had nothing written down. We had been applying the rate correctly for years — we just couldn't prove it."
— Finance Director, Community Nonprofit
Download Your Free Template
Editable Word document — yours to adapt and adopt
What's Inside the Template
Every section an auditor expects to see, already written for you
Three Cost Pools
Administrative & Finance, Facilities & Operations, and Organizational Leadership — each with the line items that belong in it already listed.
Your Rate, Three Ways
Pick and document the rate you actually use: a negotiated NICRA, the 15% de minimis rate under 2 CFR 200.414(f), or a state or local negotiated rate.
The MTDC Base
Exactly what goes into Modified Total Direct Cost — and the four categories that must be excluded before you apply your rate.
Four Mistakes That Turn Into Findings
The template closes each one with language you can adopt as-is
Charging the full subaward
Only the first $25,000 of each subaward belongs in the MTDC base. Apply your rate to the whole thing and you have over-recovered on every pass-through award.
Forcing a lower subrecipient rate
A pass-through entity cannot make a subrecipient accept less than their negotiated rate — or less than the 15% de minimis if they don't have one. Budgets get adjusted, not the rate.
Unallowable costs in the pool
Lobbying, fundraising, alcohol, fines and entertainment never enter the indirect pool. If they're in there, every program you charged is affected.
Shared costs with no written method
Splitting staff, supplies or software across programs is fine — as long as the method is logical, consistent and written down. "We just estimate it" is not a method.
Who This Template Is For
Finance Directors
CFOs and controllers who apply an indirect rate every month but have never put the method in writing.
Grant Managers
Anyone budgeting federal awards who needs to know what the rate applies to — and what it doesn't.
Pass-Through Entities
Organizations making subawards, who carry the extra duty of honoring each subrecipient's allowable rate.