Question 1

What is a cost-share requirement?

Accepted Answer

Cost-share (also called matching funds or matching contribution) is a requirement that the grant recipient contribute a specified percentage of the total project cost from non-federal sources. Example: a grant with a 25% cost-share requirement on a $1,000,000 total project means the recipient must contribute at least $250,000 of non-federal funds, and the federal award covers $750,000. Under 2 CFR § 200.306, cost-share must be verifiable from the recipient's records, not included as cost-share on other federally-funded projects, necessary and reasonable, and allowable under the federal cost principles.

Question 2

What counts as in-kind cost-share?

Accepted Answer

In-kind contributions are non-cash contributions that can satisfy cost-share requirements. Per 2 CFR § 200.306(b): allowable in-kind includes third-party donated services (valued at the fair market rate for the service), donated equipment (valued at fair market value or depreciation), donated space (valued at fair rental value), and volunteer labor (valued at the rate paid for comparable work). Example: a university researcher donating 20% effort at a $120,000 salary contributes $24,000 in in-kind cost-share. Documentation requirements are strict — each in-kind contribution needs contemporaneous records.

Question 3

How do I calculate my required cost-share amount?

Accepted Answer

The formula depends on how the requirement is expressed: (1) Percentage of federal award: Cost-share = (Required %) / (1 - Required %) × Federal award. Example: 25% cost-share on a $750,000 federal award = $250,000. (2) Percentage of total project: Cost-share = Total project × Required % - Federal award. Example: 25% of $1,000,000 total = $250,000 non-federal. Important: these formulas give different results. Always confirm whether the requirement is expressed as percentage of federal award or total project in your grant announcement.

Question 4

Can I use funds from another federal grant as cost-share?

Accepted Answer

No. Under 2 CFR § 200.306(b)(5), federal funds cannot be used to meet cost-share requirements unless specifically authorized by federal statute. This is one of the most common grant audit findings. Exception: some programs explicitly allow using other federal funds as match — this must be stated in the program's authorizing legislation or Notice of Funding Opportunity. State and local government funds, private foundation grants, and organizational cash are typical allowable sources.

Question 5

What documentation do I need to verify cost-share?

Accepted Answer

Per 2 CFR § 200.306(b)(1), cost-share must be verifiable from the recipient's records. Required documentation varies by type: for employee time, certified timesheets or effort reports showing time on the project; for in-kind services, signed time logs from volunteers or contractors plus rate documentation; for equipment, acquisition records and fair market value appraisals; for third-party cash contributions, letters of commitment and bank records. Auditors will test cost-share documentation — inadequate records can result in disallowance and repayment of the federal award proportionally.

Question 6

What is the difference between mandatory and voluntary cost-share?

Accepted Answer

Mandatory cost-share is required by statute or program policy — your application is non-compliant without it. Voluntary committed cost-share is offered in your application (often to be competitive) but not required — once committed in the application and accepted by the agency, it becomes binding and is subject to audit. Voluntary uncommitted cost-share is extra effort above what was proposed and not reflected in the budget — generally not trackable or audit-able. Federal agencies under 2 CFR § 200.306 should not use voluntary committed cost-share as a factor in merit review unless required by statute.

Federal Grant Cost-Share Calculator

Inputs coming in next batch

Frequently asked questions