2 CFR 200.466 sets 3 requirements 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.
Costs of scholarships, fellowships, and student aid programs at IHEs are allowable only when the purpose of the federal award is to provide training to participants and the Federal agency approves the cost.
Scholarship, fellowship, or student-aid lines in an IHE budget.
Tuition remission and other compensation paid as or instead of wages to students performing necessary work are allowable only if: the individual conducts activities necessary to the award; the support follows the IHE's established written policy and is consistently provided for similar activities under federal awards and other activities; the student is enrolled in an advanced degree program at the IHE or an affiliated institution and the award activities relate to the degree program; the payments are reasonable compensation explicitly conditioned on performance of necessary work; and the IHE compensates students similarly under federal awards and other activities.
Graduate tuition remission or student compensation charged to the award.
Charges for tuition remission and other compensation paid to students as or instead of salaries and wages are subject to the § 200.430 reporting requirements, must be treated as direct or indirect cost according to the actual work performed, and may be charged on an average-rate basis (see § 200.431).
Tuition remission charged as compensation on the award.
Upload the funding notice and your draft budget or narrative, and ask. Grantable answers from its compliance database of federal, agency and state rules, with citations.
(a) Costs of scholarships, fellowships, and student aid programs at IHEs are allowable only when the purpose of the Federal award is to provide training to participants, and the Federal agency approves the cost.
(b) Tuition remission and other forms of compensation paid as, or instead of, wages to students performing necessary work are allowable provided that:
(1) The individual is conducting activities necessary to the Federal award;
(2) Tuition remission and other support are provided in accordance with the established written policy of the IHE and consistently provided in a like manner to students in return for similar activities conducted under Federal awards as well as other activities; and
(3) The student is enrolled in an advanced degree program at the IHE or an affiliated institution during the academic period and the student's activities under the Federal award are related to their degree program;
(4) The tuition or other payments are reasonable compensation for the work performed and are conditioned explicitly upon the performance of necessary work; and
(5) The IHE compensates students under Federal awards as well as other activities in similar manners.
(c) Charges for tuition remission and other forms of compensation paid to students as, or instead of, salaries and wages are subject to the reporting requirements in § 200.430. The charges must be treated as a direct or indirect cost in accordance with the actual work performed. Tuition remission may be charged on an average rate basis. See § 200.431.
Source: eCFR · checked Sep 17, 2026
Costs of scholarships, fellowships, and student aid programs at IHEs are allowable only when the purpose of the federal award is to provide training to participants and the Federal agency approves the cost. Tuition remission and other compensation paid as or instead of wages to students performing necessary work are allowable only if: the individual conducts activities necessary to the award; the support follows the IHE's established written policy and is consistently provided for similar activities under federal awards and other activities; the student is enrolled in an advanced degree program at the IHE or an affiliated institution and the award activities relate to the degree program; the payments are reasonable compensation explicitly conditioned on performance of necessary work; and the IHE compensates students similarly under federal awards and other activities. Charges for tuition remission and other compensation paid to students as or instead of salaries and wages are subject to the § 200.430 reporting requirements, must be treated as direct or indirect cost according to the actual work performed, and may be charged on an average-rate basis (see § 200.431).
Scholarship, fellowship, or student-aid lines in an IHE budget. Graduate tuition remission or student compensation charged to the award. Tuition remission charged as compensation on the award.
Plain-English summaries for information only, not legal advice. Always check the regulation text, your award terms and your agency’s guidance.