Subpart E: Cost principles 2024 Uniform Guidance · effective Oct 1, 2024

2 CFR 200.451: Losses on other awards or contracts

2 CFR 200.451 sets one requirement for organizations that receive federal grants and cooperative agreements. Applies when you build your application and budget, and to every cost you charge after award.

Shows up in your application: Budget: other direct costsBudget: indirect costsCost sharing

What 2 CFR 200.451 requires

1. Allowable costs

What you must do

Any excess of costs over income under any other award or contract — including the recipient's or subrecipient's contributed portion under cost-sharing agreements, under-recoveries from negotiated flat indirect cost amounts, and any excess of costs over authorized funding levels transferred from one award or contract to another — is unallowable; losses are not allowable as indirect costs but must be included in the appropriate indirect cost rate base for allocating indirect costs.

When it applies

Budget or justification recovers a shortfall, overrun, deficit, cost-share contribution, or unrecovered indirect cost from another project, award, or contract.

Budget: other direct costsBudget: indirect costsCost sharing
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Regulation text of 2 CFR 200.451

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Any excess costs over income under any other award or contract of any nature is unallowable. This includes, but is not limited to, the recipient's or subrecipient's contributed portion by reason of cost sharing agreements or any under-recoveries through negotiation of flat amounts for indirect costs. Also, any excess of costs over authorized funding levels transferred from any award or contract to another is unallowable. All losses are not allowable indirect costs and must be included in the appropriate indirect cost rate base for allocating indirect costs.

Source: eCFR · checked Sep 17, 2026

Questions about 2 CFR 200.451

What does 2 CFR 200.451 require?

Any excess of costs over income under any other award or contract — including the recipient's or subrecipient's contributed portion under cost-sharing agreements, under-recoveries from negotiated flat indirect cost amounts, and any excess of costs over authorized funding levels transferred from one award or contract to another — is unallowable; losses are not allowable as indirect costs but must be included in the appropriate indirect cost rate base for allocating indirect costs.

When does 2 CFR 200.451 apply?

Budget or justification recovers a shortfall, overrun, deficit, cost-share contribution, or unrecovered indirect cost from another project, award, or contract.

Plain-English summaries for information only, not legal advice. Always check the regulation text, your award terms and your agency’s guidance.