Government grants and contributions
50 answers. Written by the celerfunding.com editorial team from official sources. Each answer shows where it applies and when its sources were read.
Is every government contribution a grant that I never repay?
No. Government support comes in several forms, and some of it is repayable.
The ISED toolkit says to separate non-repayable, repayable and conditionally repayable contributions and to check agreement conditions. Examples show the range. CanExport SMEs can be a grant or a reimbursement-based contribution. The ACOA Business Development Program offers repayable business funding. The Social Finance Fund supplies repayable investment capital through intermediaries. Indigenous Access to Capital offers non-repayable equity contributions through Indigenous lenders.
Reimbursement means you pay first and are paid back for eligible costs, so cash flow matters.
Before you accept anything, find out whether it is repayable, what costs are eligible, and what reporting applies.
Nothing here is an eligibility decision. Read the program page and, once you have an offer, the agreement itself.
Next: Canada funding resources
Sources (read 2026-10-31): ISED application toolkit; CanExport guide; BDP; Canada Social Finance Fund; ISC
Does the SBA give grants to start or expand a small business?
Generally no. SBA does not offer general grants to start or expand a business.
Its grants are limited. They cover certain research, entrepreneurship-support and export-related routes, and some awards go to intermediary organizations rather than ordinary businesses.
The best-known research route is SBIR/STTR, where agencies fund research and development by eligible for-profit small businesses. It has its own deadlines, and nonprofits cannot receive an SBIR/STTR award directly.
Most SBA help for ordinary businesses is a guaranteed or microloan that you repay through a lender or intermediary.
Federal grant notices are published on Grants.gov, and each states who may apply.
For a next step, review SBA's own funding page and check which route fits your purpose.
Next: SBA grants page
Sources (read 2026-10-31): SBA grants; SBIR application guidance; Grants.gov eligibility
Does the government give grants to individuals to start a business or cover personal expenses?
Generally no for personal expenses, and rarely for ordinary start-ups. USAGov says federal grants are typically for states and organizations, not individuals, and that the government does not provide grants for personal expenses.
Federal loans may be available to individuals for things such as small businesses, education and disaster recovery. A loan is repaid with interest, so it is a different thing from a grant.
USAGov also warns that people who offer free government money are a common scam, and that anyone asking for your personal information or money to get a grant or loan is probably a scam.
This answer covers the United States. Canadian programs differ, and most Canadian business support is a contribution or loan with conditions, not free cash.
A sensible next step is to read the official funding guide for your country and check each program's own eligibility page. You can send CELER an enquiry if you want help sorting out which type of funding fits your purpose.
Next: United States funding resources
Related: Is every government contribution a grant that I never repay?; Does the SBA give grants to start or expand a small business?
Sources (read 2026-11-01): USAGov: Grants and federal assistance; USAGov guidance
What is the difference between a grant and a cooperative agreement in a US federal award?
The difference is how involved the federal agency is. Both are ways of transferring something of value to a non-federal organization for a public purpose.
Grants.gov explains that in a grant, the federal agency or pass-through entity does not take substantial part in carrying out the funded activity. In a cooperative agreement, the agency or pass-through entity is substantially involved, for example by helping to shape or monitor the work.
In practice, a cooperative agreement can mean more agency oversight, approvals or joint planning than a plain grant. The funding notice and the award terms say which instrument is used.
Neither is a loan, and both come with conditions on how money is spent and reported.
Before you apply, read the funding notice to see which instrument applies and what involvement to expect. This is general information, not advice on a specific award.
Next: Grants.gov terminology
Related: What is a funding opportunity announcement (NOFO) and why read it before applying?
Sources (read 2026-11-01): Grants.gov: Grant terminology
What is a funding opportunity announcement (NOFO) and why read it before applying?
It is the public document in which an agency announces that it intends to award discretionary grants or cooperative agreements. Read it first because it holds the rules you will be judged on.
Grants.gov calls this a funding opportunity announcement and notes that agencies may also call it a program announcement, notice of funding availability or solicitation. The label differs, but the job is the same.
The announcement is where you find who may apply, what the program funds, any cost-sharing, deadlines and how applications are assessed. Each notice sets its own applicant types, so a program open to nonprofits may exclude businesses, or the reverse.
A good habit is to read the full notice, not a summary, and to note the closing date and the required registrations before you start writing.
Nothing in a notice is a promise that your application will be funded. Check the agency's official page for updates or amendments.
Next: Grants.gov
Related: What is the difference between a grant and a cooperative agreement in a US federal award?; What is an Assistance Listing number and where do I find it?
Sources (read 2026-11-01): Grants.gov: Grant terminology
What is an Assistance Listing number and where do I find it?
It is the identifier for a federal assistance program. The Assistance Listing is the government-wide source of information on federal programs that provide grants, loans, scholarships, insurance and other assistance, and it replaced the name CFDA.
Grants.gov says each program has an Assistance Listing Number, and the first two digits identify the administering federal agency. The listing is searchable on SAM.gov.
The number matters because funding notices and award documents cite it, and it lets you look up a program's description, eligibility and the kinds of assistance offered. It also helps you tell similar programs apart.
A program being listed does not mean money is available right now. Open competitions are published separately as funding notices.
If you see an unfamiliar number in a notice, look it up in the official listing before you assume what the program covers.
Next: Grants.gov
Related: What is a funding opportunity announcement (NOFO) and why read it before applying?
Sources (read 2026-11-01): Grants.gov: Grant terminology
What does cost sharing or matching mean in a government funding program?
It means you pay part of the project costs yourself. Grants.gov defines cost sharing or matching as the part of project costs not paid with federal funds, unless a statute allows otherwise.
Canadian programs work the same way in practice. The ISED toolkit gives the example of a program funding 60% of eligible costs up to a limit, leaving 40% to you. You also cover costs above the program's limit and any ineligible costs.
Some programs accept in-kind contributions, valued at fair market value, toward the cost-share. You generally must show you can fund total project costs from government and non-government sources, and securing other funding early can strengthen an application.
Check each program's guide for the exact percentage and what counts, and plan your cash flow before you commit.
Next: Government grants answers
Related: Can I get federal grant money through a state agency or another organization?
Sources (read 2026-11-01): Grants.gov: Grant terminology; ISED application toolkit
Can I get federal grant money through a state agency or another organization?
Yes, sometimes. Some federal money reaches you as a subaward from another organization instead of directly from the agency.
Grants.gov defines a pass-through entity as a non-federal entity that provides a subaward to a subrecipient to carry out part of a federal program. In practice, a federal agency may issue funds to a state agency or institution, which then passes them to other eligible groups. A subaward excludes payments to contractors and to individuals who are program beneficiaries.
So if a program is not open to your type of organization, check whether the money is distributed by a state, city or intermediary, and look for that body's own application process and rules.
Subrecipients usually take on reporting and conditions set by the pass-through entity, on top of federal ones. Ask what these are before you accept.
This is general information and not a ruling on whether a given program will fund you.
Next: US funding resources
Related: What does cost sharing or matching mean in a government funding program?
Sources (read 2026-11-01): Grants.gov: Grant terminology
What do I need to set up before applying for a US federal grant as an organization?
At minimum you need a Grants.gov account, and organizations have extra registration requirements. Do this early because it can take time.
Grants.gov says you fill out the registration form, confirm your email, then sign in with Login.gov or create a Login.gov account first. If you apply as an organization, you add an organization profile. Organizations that have not applied through Grants.gov before are pointed to the required registration and authorization page and the Quick Start Guide.
The page does not state how long registration takes or what it costs, so check the linked official guidance and do not rely on a third party's estimate. You do not need a Grants.gov profile just to search or save searches.
Avoid paying anyone to register you; the official steps are listed on the site.
Next, read the specific funding notice for any further requirements.
Next: Grants.gov registration
Related: What is a funding opportunity announcement (NOFO) and why read it before applying?
Sources (read 2026-11-01): Grants.gov: Register
Can government funding pay for costs I incurred before the project start date?
Usually not. The ISED toolkit says grant funds generally cannot cover expenses incurred before the project start date, and costs outside the funding period in the agreement are generally not supported.
Eligible costs are set by each program in its application guide and funding agreement. Examples include salaries, overhead, patents and equipment, and some programs cap particular categories.
Conditional approval is not final until a funding agreement is signed, so spending before then is at your own risk.
This summary reflects Canadian federal guidance. US federal awards have their own cost rules, so read the specific notice and award terms.
Before you buy anything, ask the program officer in writing whether a cost would count and from what date. Keep your own records of what you spent and when.
Next: Canada funding resources
Related: Can I use government funding to pay a grant writer or consultant to prepare my application?
Sources (read 2026-11-01): ISED application toolkit
Can I use government funding to pay a grant writer or consultant to prepare my application?
Generally no. The ISED toolkit says funding generally cannot pay for services used to prepare the application, such as grant writers, so those costs are yours.
That is a general rule for the federal programs the toolkit covers, and a specific program's guide may differ, so check its eligible-cost list.
If you hire help, be careful about success-fee deals. Some programs restrict or ban payments tied to winning funding, and you stay responsible for what the application says.
Also confirm the program's rules on who may submit the application on your behalf before you sign anything.
A safe next step is to ask the program in writing whether any preparation costs are eligible, and to keep your own budget line for them.
Next: CELER funding review
Related: Can government funding pay for costs I incurred before the project start date?
Sources (read 2026-11-01): ISED application toolkit
What is a stacking limit and can several governments fund the same project?
Sometimes yes, but there is usually a cap. The ISED toolkit says some programs let you combine funding from federal, provincial, territorial and municipal sources for different parts of one project.
A program may set a stacking limit, which caps total government funding for any one activity, initiative or project. Limits are normally written as a percentage of eligible costs.
That means a second source can reduce what the first will pay, and you may have to report all government funding you receive.
Before you apply to several programs, read each guide's stacking and disclosure rules and add up the possible total. If you exceed a limit, expect a reduction or repayment.
This describes Canadian federal guidance. Other countries and programs set their own rules.
Next: Canada funding resources
Related: What does cost sharing or matching mean in a government funding program?
Sources (read 2026-11-01): ISED application toolkit
Do I need a Business Number or to be incorporated to get federal funding in Canada?
Often yes for both, but it depends on the program. The ISED toolkit says applicants often need a nine-digit Business Number issued by the Canada Revenue Agency.
It also says many programs require the applicant to be incorporated in Canada, while partnerships and sole proprietorships may be eligible under some programs. You may be asked for your six-digit NAICS code and the details of your authorized representative.
Some programs also require affiliation with an eligible institution, business or municipality.
Because rules differ, do not assume. Check the applicant eligibility section of the specific guide, and ask the program if your legal structure is unclear. Changing structure just to apply can have tax and legal effects, so get professional advice first.
You can send CELER an enquiry if you want to talk through readiness.
Next: Canada funding resources
Related: Does the government give grants to individuals to start a business or cover personal expenses?
Sources (read 2026-11-01): ISED application toolkit
How long does a Canadian government funding decision usually take?
It varies by program, and from weeks to months is typical. The ISED toolkit says programs run either continuous intake or fixed intake periods with deadlines.
Decisions can take weeks to months depending on program volume and how quickly you respond during due diligence. Some programs use two steps, such as a letter of intent or statement of interest before a full application.
The toolkit also says late applications are usually rejected, so allow time and submit early. Conditional approval is not final until a funding agreement is signed.
No timeline here is a promise, and each program publishes its own service information.
Plan your project dates around the program's intake, review, project duration and completion window, and do not commit spending on the assumption you will be funded.
Next: Canada funding resources
Related: Can government funding pay for costs I incurred before the project start date?
Sources (read 2026-11-01): ISED application toolkit
What reporting and record-keeping should I expect after receiving a government contribution?
Expect more reporting for contributions than for grants. The ISED toolkit says grant reporting is usually limited to confirming ongoing eligibility and measuring performance, while contributions require progress reports and detailed financial reports, and payments are often tied to approved reports.
Programs may hold back a portion, often 10%, until final reports are in. Major changes need program approval and an amendment to the agreement.
You should keep project accounts separate from regular operations, follow generally accepted accounting principles and keep an audit trail, because funded projects may be audited. Reporting can continue for years after the project ends.
The federal fiscal year runs April 1 to March 31, which can shape payment and reporting schedules.
Read the reporting section of the agreement before you sign, and set up your bookkeeping first.
Next: Canada funding resources
Related: Is every government contribution a grant that I never repay?
Sources (read 2026-11-01): ISED application toolkit
Do government programs accept late applications or require a letter of intent first?
Late applications are usually rejected, and some programs ask for a short screening submission before the full application. The ISED toolkit says to submit early and allow time for preparation.
A two-step process is common in some cases: first a letter of intent or statement of interest, then, if invited, a full application. By submission you should be project-ready, with permits, IP rights and partnership agreements in order, and documents such as financial statements and letters of support gathered.
Some programs take applications continuously, so there may be no single deadline. Others have fixed windows.
If you miss a window, check the program page for the next intake, and ask whether an extension is possible only if the guide allows it. Do not assume.
This reflects Canadian federal guidance and not a specific program.
Next: Canada funding resources
Related: How long does a Canadian government funding decision usually take?
Sources (read 2026-11-01): ISED application toolkit
Can in-kind contributions such as staff time count toward my share of project costs?
Sometimes. The ISED toolkit says some programs accept in-kind contributions, valued at fair market value, toward cost-share obligations. Not every program does.
You still need to show you can fund total project costs, including government and non-government sources. Cash is generally clearer than in-kind, and securing non-government funding early can strengthen an application.
The application guide says what counts, how to value it and how to document it. Keep records such as timesheets, invoices or quotes that support the stated value.
This summary reflects Canadian federal guidance. US federal programs set their own cost-sharing rules in each funding notice.
Ask the program in writing if you are unsure whether your contribution qualifies.
Next: Canada funding resources
Related: What does cost sharing or matching mean in a government funding program?
Sources (read 2026-11-01): ISED application toolkit
Does the Canadian government offer grants to start a business?
Rarely as free cash. Canadian federal support for business is mostly contributions and loans, many repayable, with conditions.
The ISED toolkit separates grants, which are unconditional and non-repayable, from contributions, which can be non-repayable, repayable in whole or part, or a mix. It adds that conditionally repayable money is repaid only if conditions such as a revenue threshold are met.
Many programs also expect an incorporated applicant and a Business Number, and most require you to share costs.
To explore options, start with official federal, provincial and regional business-support directories, then read each program's eligibility page.
Nothing here means you will qualify for any program. You can send CELER an enquiry if you would like help reviewing what to look at.
Next: Canada funding resources
Related: Is every government contribution a grant that I never repay?; Do I need a Business Number or to be incorporated to get federal funding in Canada?
Sources (read 2026-11-01): ISED application toolkit
Is a government 'grant' ever taxed or reported differently from a loan?
This is a tax question, and the answer depends on your country, your structure and the program, so no safe general answer fits.
What the sources used here do support is that the type of funding matters. The ISED toolkit describes grants as non-repayable, contributions as sometimes repayable, and unconditionally repayable funding as repaid on a schedule. Repayable money is treated like debt in many ways, while non-repayable money is not, but the tax result can differ.
Because of this, ask a qualified accountant before you plan around any amount.
For Canada, the tax authority publishes guidance on government assistance. For the United States, see IRS guidance for your entity type.
We have not verified the tax treatment in this run, so this record is held for review.
Next: Tax answers
Related: Is every government contribution a grant that I never repay?
Sources (read 2026-11-01): ISED application toolkit
Is there a government grant to pay off business debt?
No official source read here shows a government grant that pays off business debt. Treat any offer that says otherwise with suspicion.
The FTC says real grants need an application and are for a very specific purpose. It says agencies do not contact you out of the blue to offer one. Any request for an upfront fee, or payment by gift card, wire or cryptocurrency, is a scam sign. The SBA says it does not provide grants to start or expand a business, and that it emails only from addresses ending in sba.gov.
Refinancing existing debt is a different thing and is done through loans. Some loan programs allow it under their own rules, but a loan is repaid and is not a grant.
Next step: read the program rules, never pay to access a grant, and report scams at ReportFraud.ftc.gov.
Next: More answers
Related: Is every government contribution a grant that I never repay?; Does the Canadian government offer grants to start a business?
Sources (read 2026-11-01): Government grant scams; SBA grants
Do for-profit businesses have to follow the single audit rules?
Generally no. The federal single audit subpart does not apply to for-profit organizations.
The federal uniform rules say a non-federal entity that spends $1,000,000 or more in federal awards in its fiscal year must have a single audit. Below that amount the audit requirement does not apply for the year, but records must stay available for review. The rules also say the audit subpart does not cover for-profit organizations.
That does not mean a for-profit is free of oversight. The funding agency or pass-through entity can set its own audit, reporting and record-keeping terms in the award agreement.
These rules are the federal baseline. States and individual programs can add requirements.
Next step: read your award terms and ask the awarding agency how a for-profit recipient is reviewed.
Next: More answers
Related: When does a US grant recipient need a single audit?; What reporting and record-keeping should I expect after receiving a government contribution?
Sources (read 2026-11-01): 2 CFR 200.501 Audit requirements
How can I see which organizations received federal grants?
Start with USAspending.gov, which the US Treasury describes as the official source for US government spending data.
Treasury says the site lets people follow money from Congress to agencies to local communities and businesses. The page read here did not spell out the search filters or the recipient coverage, so check the site itself for what can be searched.
Agencies submit the underlying data, so entries can lag actual events or contain errors. Use the data to see which kinds of organizations a program funds. Do not treat it as proof that you would be approved.
Grants.gov, in contrast, lists open opportunities, not past awards.
Next step: open USAspending.gov, search a program or agency, and read the program's own notice for current rules.
Next: More answers
Related: What is an Assistance Listing number and where do I find it?; What is a funding opportunity announcement (NOFO) and why read it before applying?
Sources (read 2026-11-01): Data transparency and USAspending
What is an indirect cost rate in a federal grant?
It is the percentage a recipient uses to recover shared overhead that cannot be tied to one award, such as building depreciation or general administration.
Under the federal uniform rules, whether a cost is direct or indirect depends on whether it ties to a federal award. Agencies must accept a negotiated rate unless a law or approved deviation says otherwise. A recipient without a current negotiated rate may elect a de minimis rate of up to 15 percent of modified total direct costs. It needs no documentation and can continue until the recipient moves to a negotiated rate.
The 15 percent figure is a ceiling on the de minimis choice, not an entitlement. Funding notices can limit or set indirect costs for a program.
Next step: check the notice for indirect cost limits before building your budget.
Next: More answers
Related: What does cost sharing or matching mean in a government funding program?; What reporting and record-keeping should I expect after receiving a government contribution?
Sources (read 2026-11-01): 2 CFR 200.414 Indirect costs
When does a US grant recipient need a single audit?
A single audit is required when a non-federal entity spends $1,000,000 or more in federal awards during its fiscal year.
That threshold is in the federal uniform rules. Some entities with awards under only one federal program, or certain research awards, may elect a program-specific audit if they meet the stated conditions. Entities under the threshold are exempt for that year, but they must keep records available for review. For-profit organizations are not covered by this audit subpart.
The threshold counts federal funds spent, not funds received and not total budget. Pass-through awards from a state or other organization count as federal expenditures.
Next step: tell your accountant the fiscal year, plan early, and read your award terms for extra audit conditions.
Next: More answers
Related: Do for-profit businesses have to follow the single audit rules?; What reporting and record-keeping should I expect after receiving a government contribution?
Sources (read 2026-11-01): 2 CFR 200.501 Audit requirements
Can US federal awards cover costs incurred before the award date?
Sometimes, but only with the federal agency's written approval.
Under the federal uniform rules, pre-award costs may be allowable if they were incurred before the award started, directly tied to negotiating or anticipating the award, and needed so the work can be done efficiently once the scope begins. They must also be costs that would have been allowed after the start date. If approved, they generally go into the initial budget period unless the agency says otherwise.
Incurring costs early is at your own risk. The agency may refuse approval, and a program notice can set tighter rules.
Next step: ask the program officer in writing before spending, and keep the approval with your records.
Next: More answers
Related: Can government funding pay for costs I incurred before the project start date?; Can I use government funding to pay a grant writer or consultant to prepare my application?
Sources (read 2026-11-01): 2 CFR 200.458 Pre-award costs
Can for-profit businesses apply directly for Economic Development Administration funding?
Mostly no. For-profits are eligible for EDA investment assistance only in a narrow case.
EDA's rules list eligible recipients such as cities and other political subdivisions, states, higher education institutions, district organizations, Tribes, and public or private nonprofits (including community or faith-based ones) that work with local government officials. Private individuals and for-profit organizations are listed only for training, research and technical assistance investments.
A company can still benefit indirectly when an eligible partner, such as a local government, receives funds for infrastructure or development that serves it. That is not a grant to the company.
Next step: contact your local economic development organization or the regional EDA office about current notices.
Next: More answers
Related: Can I get federal grant money through a state agency or another organization?; Can a small business get Community Development Block Grant money?
Sources (read 2026-11-01): 13 CFR 300.3 Definitions (EDA)
Can a small business get Community Development Block Grant money?
Not directly from HUD. CDBG money flows through the local or state grantee, which may assist a business.
HUD's rules let a CDBG recipient provide assistance to a private for-profit business, in forms such as grants, loans, loan guarantees, interest supplements or technical assistance, where the help suits an economic development project. The recipient must also consider displacement and make sure the project delivers the required public benefit before committing funds. Some activities are listed as ineligible.
Availability depends on whether your city, county or state runs such a program and its local rules.
Next step: contact your city or county community development office and ask whether it funds business assistance, and what public benefit it requires.
Next: More answers
Related: Can I get federal grant money through a state agency or another organization?; Can for-profit businesses apply directly for Economic Development Administration funding?
Sources (read 2026-11-01): 24 CFR 570.203 Special economic development activities
What are SAM.gov and a UEI?
SAM.gov is the federal system where organizations register to do business with the US government, and a UEI is the Unique Entity ID it assigns to identify your organization.
SAM.gov says registration includes getting a UEI, and you can also request a UEI without registering. Without registering, however, you cannot apply directly for federal awards. The page read here did not state any fees, so confirm costs on the site and treat any third party charging for registration with caution.
Individuals applying as a business or pass-through subrecipients may face different requirements, so read each notice.
Next step: start early, because registration can take time before a deadline, and use only the official SAM.gov site.
Next: More answers
Related: What do I need to set up before applying for a US federal grant as an organization?; Can being excluded or debarred stop me from receiving a government award?
Sources (read 2026-11-01): SAM.gov Unique Entity ID
Can being excluded or debarred stop me from receiving a government award?
Yes. A person who is excluded cannot take part in a federal covered transaction.
The federal rules say an excluded person cannot participate in a covered transaction with a federal agency, and cannot act as a principal for someone who is. There are limited exceptions in the rules. Exclusions are recorded in the government's registry, and agencies are expected to check it before awarding.
Exclusion can stem from serious misconduct or from enforcement after a prior award goes wrong. It can also affect related people and entities, so ask about your own situation.
This is general information, not legal advice. Next step: check your own record and your key people, and speak to a lawyer if an exclusion or proposed debarment affects you.
Next: More answers
Related: What do I need to set up before applying for a US federal grant as an organization?; Can the government take back grant money if I misuse it?
Sources (read 2026-11-01): 2 CFR 180.130 Effect of exclusion
Does the US government give grants specifically for minority-owned or women-owned businesses?
Not in the way many people expect. The SBA says the federal government does not provide grants to start a business.
The SBA instead points to support programs. The Women-Owned Small Business federal contracting program helps eligible firms compete for federal contracts. The 8(a) Business Development program helps socially and economically disadvantaged small businesses through contract set-asides, counselling, training and mentoring. The Minority Business Development Agency works on growing minority-owned businesses, and Women's Business Centers offer training and counselling.
These are contracting and advisory programs, not cash grants. Some states, cities and private groups run their own contests or grants, each with its own rules.
Next step: check eligibility on the SBA page, and avoid anyone asking a fee for a promised grant.
Next: More answers
Related: Does the SBA give grants to start or expand a small business?; Is there a government grant to pay off business debt?
Sources (read 2026-11-01): SBA women-owned businesses; SBA grants
Can the government take back grant money if I misuse it?
Yes, in effect. When a recipient does not comply, federal rules let the agency take several actions.
The uniform rules allow the agency to withhold payments, disallow costs tied to the noncompliant activity, suspend or terminate the award, start suspension or debarment, withhold future funds, or use other remedies the law allows. The section read does not itself list recovery of funds, but disallowed costs are the usual route to repayment. Your award terms may spell out repayment further.
These rules apply to federal awards. State, provincial and other programs have their own terms.
This is general information, not legal advice. Next step: keep records, follow the budget, ask for approval in writing before changing it, and get legal advice if you receive a notice.
Next: More answers
Related: What reporting and record-keeping should I expect after receiving a government contribution?; Can being excluded or debarred stop me from receiving a government award?
Sources (read 2026-11-01): 2 CFR 200.339 Remedies for noncompliance
What do allowable, allocable and reasonable mean for costs charged to a US federal award?
They are three tests a cost must pass before you charge it to a US federal award. Allowable means it follows the cost rules and your award terms. Allocable means it actually benefits the award, in a fair proportion. Reasonable means a prudent person would have spent that amount in the same situation.
As of 2026-11-01, 2 CFR 200.403 also asks that a cost be necessary for the award, treated consistently with your other activities, adequately documented, and not already used to meet cost sharing on another federal program. Section 200.404 looks at market prices for comparable items, sound business practice and arm's-length bargaining. Section 200.405 treats a cost as allocable if it is incurred for the award, benefits the award and other work in reasonable proportions, or is necessary to overall operations and fairly assignable.
Your notice of funding opportunity and award terms can add limits. If you are unsure about a cost, ask the program officer in writing before you spend.
This is general information, not accounting or legal advice.
Next: United States funding resources
Related: What is an indirect cost rate in a federal grant?; Can government funding pay for costs I incurred before the project start date?
Sources (read 2026-11-01): 2 CFR 200.403 (factors affecting allowability of costs); 2 CFR 200.404 (reasonable costs); 2 CFR 200.405 (allocable costs)
Do I have to get quotes or run a bidding process when I buy things with US federal grant money?
Usually yes, in some form. You must follow written procurement procedures, and the method depends on the size of the purchase.
As of 2026-11-01, 2 CFR 200.318 requires documented procedures, oversight of contractors and written conflict-of-interest standards. Under 200.320, small purchases can use informal methods. A micro-purchase can be awarded without competing quotes if you consider the price reasonable and keep documents showing why. Above that, up to the simplified acquisition threshold, you must get price quotes from an adequate number of qualified sources. Above that threshold, formal methods such as sealed bids or proposals with public notice are required.
Noncompetitive buying is allowed only in listed cases, such as a single source, a public emergency, a very small purchase, or written approval from the agency or pass-through entity. The dollar thresholds come from federal acquisition rules and your own policy, so check the current figures.
Keep the paperwork for every purchase. This is general information, not legal advice.
Next: United States funding resources
Related: What is an indirect cost rate in a federal grant?; Can I use grant money to buy from a company I own or a relative's business?
Sources (read 2026-11-01): 2 CFR 200.318 (general procurement standards); 2 CFR 200.320 (procurement methods)
Can I use grant money to buy from a company I own or a relative's business?
Not without strong safeguards. Federal rules bar anyone with a real or apparent conflict of interest from taking part in choosing or managing a contract paid with a federal award.
As of 2026-11-01, 2 CFR 200.318(c) says a conflict exists when an employee, officer, agent or board member, a close family member, a partner, or an organization that employs them has a financial or other interest in a company being considered. You must keep written standards of conduct, and staff may neither ask for nor accept gifts or favors from contractors, except nominal unsolicited items if your standards allow them.
The cost must also be reasonable, and section 200.404 lists arm's-length bargaining among the factors reviewers weigh. In a small business where the owner makes every decision, a related-party purchase is hard to defend.
If you think a related-party purchase is unavoidable, ask the agency or pass-through entity in writing first and get legal advice. This is general information, not legal advice.
Next: United States funding resources
Related: Do I have to get quotes or run a bidding process when I buy things with US federal grant money?; Can being excluded or debarred stop me from receiving a government award?
Sources (read 2026-11-01): 2 CFR 200.318 (general procurement standards); 2 CFR 200.404 (reasonable costs)
Can I use federal grant money to pay for lobbying?
Generally no. Federal cost rules make most lobbying and influence costs unallowable on a US federal award.
As of 2026-11-01, 2 CFR 200.450 says the costs of certain influencing activities tied to obtaining grants, cooperative agreements, contracts or loans are unallowable, under rules including 31 U.S.C. 1352. Costs of trying to improperly influence a federal executive-branch employee about an award or regulatory matter are also unallowable. Improper influence means influence that pushes an official to act on something other than merit.
Nonprofit organizations and institutions of higher education face further limits. Costs of influencing elections, supporting political parties, campaigns or political action committees, and trying to influence federal or state legislation, including grassroots lobbying campaigns, are unallowable. The section has more detail, so read the full text.
This is about what federal funds may pay for, which differs from a charity's own lobbying limits. Ask your program officer before charging anything close to the line. This is general information, not legal advice.
Next: United States funding resources
Related: Which common costs can federal grant money not pay for, such as alcohol, entertainment or fines?; Can the government take back grant money if I misuse it?
Sources (read 2026-11-01): 2 CFR 200.450 (lobbying)
Which common costs can federal grant money not pay for, such as alcohol, entertainment or fines?
Alcohol and fines are off limits, and entertainment is allowed only in narrow cases.
As of 2026-11-01, 2 CFR 200.423 says the cost of alcoholic beverages is unallowable. Section 200.438 says entertainment, including amusement, diversion and social activities and associated costs such as gifts, is unallowable unless it has a specific and direct programmatic purpose and is included in the federal award. Prizes or challenges are allowable only if they have a specific and direct programmatic purpose and are in the award.
Section 200.441 says costs from violating, or being accused of violating, federal, state, local, tribal or foreign laws are unallowable, unless they result from complying with a specific award provision or the agency approved them in writing beforehand.
These are examples, not a full list. Lobbying is covered in a separate answer. If a cost is not clearly allowed, get written approval before you spend. This is general information, not legal advice.
Next: United States funding resources
Related: What do allowable, allocable and reasonable mean for costs charged to a US federal award?; Can I use federal grant money to pay for lobbying?
Sources (read 2026-11-01): 2 CFR 200.423 (alcoholic beverages); 2 CFR 200.438 (entertainment and prizes); 2 CFR 200.441 (fines, penalties, damages and other settlements)
What is the difference between a subrecipient and a contractor on a US federal award?
A subrecipient helps carry out the federal program itself. A contractor sells goods or services you buy to run it. The label changes which rules apply.
As of 2026-11-01, 2 CFR 200.331 says the pass-through entity decides case by case, and the substance of the relationship matters more than the form of the agreement. Signs of a subrecipient include deciding who is eligible for assistance, having performance measured against the program's objectives, making programmatic decisions, being responsible for following federal program requirements, and carrying out a public purpose rather than serving the pass-through entity. Signs of a contractor include providing goods or services in normal business operations, serving many buyers, operating in a competitive market, offering items that are ancillary to the program, and not being subject to the program's compliance requirements.
No single factor decides it. If you are unsure which you are, ask the pass-through entity in writing and keep the answer. This is general information, not legal advice.
Next: United States funding resources
Related: Can I get federal grant money through a state agency or another organization?; Do I have to get quotes or run a bidding process when I buy things with US federal grant money?
Sources (read 2026-11-01): 2 CFR 200.331 (subrecipient and contractor determinations)
Do I have to report suspected fraud or bribery connected to a federal award?
Yes. A US federal award carries a duty to disclose promptly when you have credible evidence of certain serious violations.
As of 2026-11-01, 2 CFR 200.113 says an applicant, recipient or subrecipient must promptly disclose, in writing, credible evidence of a federal criminal violation involving fraud, conflict of interest, bribery or gratuities under Title 18 of the US Code, or of a violation of the civil False Claims Act, when it arises in connection with the award, including activities and subawards. The disclosure goes to the federal agency, the agency's Office of Inspector General, and the pass-through entity if there is one. Recipients must also report recipient integrity and performance matters as set out in Appendix XII of the rule. Failure to disclose can lead to the remedies for noncompliance.
If you think something has gone wrong, stop, keep records and speak to a lawyer quickly. This is general information, not legal advice.
Next: United States funding resources
Related: Can the government take back grant money if I misuse it?; Can being excluded or debarred stop me from receiving a government award?
Sources (read 2026-11-01): 2 CFR 200.113 (mandatory disclosures)
What is the difference between a formula grant and a discretionary grant?
A formula grant is split among eligible governments by a set formula. A discretionary grant is competed, and the agency chooses who gets money and how much.
As of 2026-11-01, Grants.gov defines a formula grant as an allocation of federal funding to states, territories or local governments by distribution formulas in the authorizing law and regulations. Eligibility criteria are fixed in advance and not open to discretionary decisions, and the funds typically support continuing activities. A discretionary grant is one where the agency can generally choose the recipient from all eligible applicants, decide whether to make an award based on the application's content, and decide the amount. A mandatory grant is one where the statute requires the agency to make an award to each eligible entity.
Businesses and nonprofits usually reach formula money only when a state or local agency passes it on, and Grants.gov calls that pass-through funding. Read the notice of funding opportunity to see which type you are looking at. This is general information.
Next: United States funding resources
Related: Can I get federal grant money through a state agency or another organization?; What is a funding opportunity announcement (NOFO) and why read it before applying?
Sources (read 2026-11-01): Grants.gov: Grant terminology
What do period of performance and budget period mean, and is multi-year federal funding guaranteed?
No. A multi-year award does not promise money for every year.
As of 2026-11-01, 2 CFR 200.1 defines the period of performance as the time between an award's start and end dates, which may include one or more budget periods. A budget period is the interval for a funded portion during which you can incur obligations. The rule adds that naming a period of performance does not commit the agency to fund the award beyond the budget period currently approved. Under 2 CFR 200.211, when an award will span several budget periods, the agency must state that later periods depend on available funds, program authority, satisfactory performance and compliance with the award terms.
Grants.gov describes a continuation grant as an extension of funding for further budget periods, usually for existing recipients of multi-year discretionary projects, based on funds, performance and reporting compliance.
Plan your cash flow around the approved budget period and read your award terms for continuation steps. This is general information.
Next: United States funding resources
Related: What reporting and record-keeping should I expect after receiving a government contribution?; Can government funding pay for costs I incurred before the project start date?
Sources (read 2026-11-01): 2 CFR 200.1 (definitions); 2 CFR 200.211 (information contained in a Federal award); Grants.gov: Grant terminology
What internal controls does a US federal grant recipient need?
You need documented internal controls that give reasonable assurance you are managing the award within the law and its terms.
As of 2026-11-01, 2 CFR 200.303 requires a recipient or subrecipient to establish, document and maintain effective internal control over the federal award. The controls should align with the Government Accountability Office's Green Book or the COSO Internal Control framework. You must also follow the Constitution, federal statutes, regulations and the award terms, evaluate and monitor your own compliance, take prompt action when noncompliance appears, and take reasonable cybersecurity and other measures to protect information, including personally identifiable information.
A practical start is a short written procedure that says who approves spending, who records it, how you check it and where records are kept. Ask the agency or pass-through entity whether the award adds requirements.
This is general information, not accounting or legal advice.
Next: United States funding resources
Related: What reporting and record-keeping should I expect after receiving a government contribution?; What do I need to set up before applying for a US federal grant as an organization?
Sources (read 2026-11-01): 2 CFR 200.303 (internal controls)
Can a federal agency end my award early?
Yes, in the situations the rules and your award terms allow.
As of 2026-11-01, 2 CFR 200.340 lets an award be ended in whole or in part: by the agency or pass-through entity if you fail to comply with the terms; by agreement of both sides; by you, with written notice giving your reasons and the effective date; or under the award's own terms, including, to the extent the law allows, if the award no longer meets program goals or agency priorities. The agency must state its termination provisions clearly in the award.
Under 2 CFR 200.342, when an agency starts a remedy such as disallowed costs, a corrective action plan or termination, it must give you a chance to object and provide information, and follow any hearing or appeal rights the law gives you. If it ends an award for material noncompliance, it reports the termination in SAM.gov after you have used your objection options or after 30 days without telling it you intend to appeal. Closeout duties continue after termination.
Read the termination clause in your award and get legal advice if you receive a notice.
Next: United States funding resources
Related: Can the government take back grant money if I misuse it?; What reporting and record-keeping should I expect after receiving a government contribution?
Sources (read 2026-11-01): 2 CFR 200.340 (termination); 2 CFR 200.342 (opportunities to object, hearings and appeals)
Can I pay myself a salary from a federal grant?
Possibly, but only within strict pay rules and your program's own limits.
As of 2026-11-01, 2 CFR 200.430 allows compensation for employees working on an award if it is reasonable for the services, follows your written pay policy applied the same way to federal and non-federal work, and is supported by records that accurately reflect the work performed. Budget estimates alone do not count as support, though they can be used temporarily if you later check them against actual activity. Pay for certain employees can be capped by federal statute.
The rule speaks of employees. How an owner who is not on payroll, such as a sole proprietor, can be paid is a question for the program officer, and some programs set their own limits in the notice of funding opportunity. Keep time records either way.
Ask in writing before you budget your own pay. This is general information, not tax, accounting or legal advice.
Next: United States funding resources
Related: What do allowable, allocable and reasonable mean for costs charged to a US federal award?; What is an indirect cost rate in a federal grant?
Sources (read 2026-11-01): 2 CFR 200.430 (compensation, personal services)
What is program income on a US federal award and how must I use it?
Program income is money your funded project earns, and it generally has to go back into the project.
As of 2026-11-01, 2 CFR 200.1 defines it as gross income earned that is directly generated by a supported activity or earned because of the award during the period of performance. Examples include fees for services, rent or use of property bought under the award, sales of items made under it, license fees, royalties, and principal and interest on loans made with award funds. Interest earned on advances of federal funds is not program income.
Section 200.307 says program income must be used for the award's original purpose, spent before you request more federal funds, and applied by the method in your award, which is deduction, addition or cost sharing. Deduction applies if the agency names no method. Income earned after the period of performance has no federal requirement unless regulations or the award say otherwise.
Check your award terms before you charge fees. This is general information.
Next: United States funding resources
Related: What reporting and record-keeping should I expect after receiving a government contribution?; What does cost sharing or matching mean in a government funding program?
Sources (read 2026-11-01): 2 CFR 200.1 (definitions); 2 CFR 200.307 (program income)
Can a business make a profit on a federal grant?
Generally no. Federal grants reimburse allowable costs; they are not meant to produce profit.
As of 2026-11-01, 2 CFR 200.400(g) says a recipient or subrecipient must not earn or keep any profit resulting from federal financial assistance unless the terms of the award explicitly authorize it. For a fixed amount award, unspent funds kept after the required activities are completed under the award terms are not treated as profit.
Some programs state a fee or other allowance in the award terms, so always read them. Money your project earns is handled separately as program income.
If you are a for-profit business, ask the program officer how any permitted fee works before you budget. This is general information, not tax, accounting or legal advice.
Next: United States funding resources
Related: What is program income on a US federal award and how must I use it?; Can for-profit businesses apply directly for Economic Development Administration funding?
Sources (read 2026-11-01): 2 CFR 200.400 (policy guide)
Are Canadian federal contributions paid up front or after I spend the money?
Usually after progress or spending, with advances only in limited cases. Your funding agreement sets the schedule.
As of 2026-11-01, the Treasury Board Directive on Transfer Payments tells federal departments that contribution payments should rest on milestones, reimbursement of eligible expenditures, a costing formula or similar bases. Advance payments are for cases where they are essential to meeting the objectives, must be specifically provided in the agreement, and are based on your cash flow needs. Advances in a fiscal year should not exceed your estimated cash flow needs for the federal share, with a limited allowance for April of the next fiscal year. Departments may also hold back part of a payment based on the risk of non-performance or overpayment. Total contribution payments cannot exceed the eligible expenditures you actually incurred, or the portion the agreement funds. Grants over $250,000 are paid in instalments unless a single payment is needed.
Plan your cash flow before signing and ask the program officer about payment timing. This is general information.
Next: Canada funding resources
Related: What reporting and record-keeping should I expect after receiving a government contribution?; Do I have to repay unspent money or overpayments on a Canadian federal contribution?
Sources (read 2026-11-01): Treasury Board Directive on Transfer Payments
Do I have to repay unspent money or overpayments on a Canadian federal contribution?
Usually yes. Federal funding agreements are meant to require repayment of overpayments, unspent funds and disallowed expenses.
As of 2026-11-01, the Treasury Board Directive on Transfer Payments says funding agreements should include provisions for the recipient to repay overpayments, unexpended funding and disallowed expenses. They should declare these amounts debts due to the Crown, charge interest on overdue repayments under the Interest and Administrative Charges Regulations, and set how due dates are decided. Departments are told to recognize amounts repayable by or recoverable from recipients as debts due to the Crown and take appropriate recovery action. Reasonable unspent balances of advance payments held at the end of a fiscal year within a multi-year agreement are not treated as repayable at that time.
A repayable contribution is a different case, because its repayment terms are set in the agreement. Read your own agreement for amounts, dates and interest, and tell the program officer early if a problem arises. This is general information.
Next: Canada funding resources
Related: Are Canadian federal contributions paid up front or after I spend the money?; Can the government take back grant money if I misuse it?
Sources (read 2026-11-01): Treasury Board Directive on Transfer Payments
How can I see which organizations received Canadian federal grants and contributions?
Use the Government of Canada's Grants and Contributions search on Open Government. It lets you look up awards reported under proactive disclosure.
As of 2026-11-01, the search page lists records for recipients, including value, start date, recipient type, agreement title and number, duration, description and the funding organization, and offers a dataset download. It explains that the Treasury Board of Canada Secretariat set reporting rules under its Guidelines on the Reporting of Grants and Contributions Awards, effective April 1, 2018, within the Policy on Transfer Payments.
The page says some items are not reported there: transfers to other levels of government such as equalization and health and social transfers, grants and contributions that a recipient redistributes to third parties, and information normally withheld under the Access to Information Act and the Privacy Act. So a missing name does not prove nobody was funded.
Use the search to learn which programs fund organizations like yours. This is general information.
Next: Canada funding resources
Related: How can I see which organizations received federal grants?; Do I need a Business Number or to be incorporated to get federal funding in Canada?
Sources (read 2026-11-01): Open Government: Grants and Contributions (search)
Can a consultant charge me a success fee for getting Canadian federal funding?
Not if the consultant is lobbying for you. The federal Lobbying Act bars payment that depends on the outcome.
As of 2026-11-01, section 5 of the Lobbying Act requires an individual to register as a consultant lobbyist if, for payment, they undertake on behalf of a client to communicate with a public office holder about awarding a grant, contribution or other financial benefit, or to arrange a meeting with one. Section 10.1 says that person must not receive any payment that is wholly or partly contingent on the outcome or on success in arranging a meeting, and the client must not make such a payment.
The rule turns on what the consultant actually does for you. Section 5 is triggered by communicating with officials or arranging meetings, so drafting an application alone is not listed as a trigger, but the line can be hard to see. Federal funding agreements are also meant to include a declaration that anyone lobbying for the recipient complies with the Lobbying Act.
Get legal advice before you sign any fee agreement. This is general information, not legal advice.
Next: Canada funding resources
Related: Can I use government funding to pay a grant writer or consultant to prepare my application?; Are Canadian federal contributions paid up front or after I spend the money?
Sources (read 2026-11-01): Lobbying Act (R.S.C. 1985, c. 44 (4th Supp.)); Treasury Board Directive on Transfer Payments
What counts as equipment on a US federal award, and can I charge a laptop?
Equipment is longer-lasting property above a cost line, and a laptop may be chargeable in some cases.
As of 2026-11-01, 2 CFR 200.1 defines equipment as tangible personal property, including information technology systems, with a useful life of more than one year and a per-unit acquisition cost at or above the lesser of your own capitalization level or $10,000. It defines computing devices as machines that acquire, store, analyze, process and publish information electronically, including accessories such as printers.
Section 200.453 says materials and supplies needed to perform the award are allowable at actual prices, and that charging computing devices as direct costs is allowable for devices that are essential and allocable, but not solely dedicated, to the award.
The award terms may add approval, tracking or ownership rules, and equipment bought with federal funds has its own management and disposal rules. Ask the program officer to confirm in writing before you buy. This is general information, not accounting advice.
Next: United States funding resources
Related: What do allowable, allocable and reasonable mean for costs charged to a US federal award?; Can government funding pay for costs I incurred before the project start date?
Sources (read 2026-11-01): 2 CFR 200.1 (definitions); 2 CFR 200.453 (materials and supplies costs, including computing devices)
What CELER is and is not. celerfunding.com is operated by Celer Merchants Corporation. We are not a lender, grantmaker, government agency, investment portal or licensed adviser, and we are not an official partner of the programs mentioned here. This page is general information, not legal, tax, investment or credit advice. A CELER enquiry is not an official grant or loan application.