F&A/indirect costs vary depending on the indirect cost base. Indirect costs are calculated either on a Total Direct Cost (TDC) basis or a Modified Total Direct Cost basis (MTDC).
Total Direct Cost (TDC) basis: As defined in OMB A-21, "direct costs are those which can be identified specifically with a particular sponsored project, an instructional activity or any other institutional activity, or that can be directly assigned to such activities relatively easily with a high degree of accuracy. The portion of salary and fringe benefits of a faculty member performing an experiment or a specialized laboratory supply necessary for performing an experiment are examples of direct costs to a sponsored project. Other general categories are: supplies, contractual services, travel and communication, equipment and computer use."
Some externally funded projects carry an indirect cost rate of 10% TDC.
Modified Total Direct Costs (MTDC) basis: OMB A-21 defines Modified Total Direct Costs as "consisting of salaries and wages, fringe benefits, materials and supplies, services, travel, and subgrants and subcontracts up to the first $25,000 of each subgrant or subcontract (regardless of the period covered by the subgrant or subcontract). Equipment, capital expenditures, charges for patient care, tuition remission, rental costs, scholarships, and fellowships as well as the portion of each subgrant and subcontract in excess of $25,000 shall be excluded from modified total direct costs."
