Computers and Data Storage Devices
Guideline Date: April 2015 Revision: 1 Last Review: August 2017
Why are computers and/or data storage devices normally treated as indirect costs?
Technology has changed rapidly over the past few decades. Desktops, laptops and data storage devices perform a wide range of functions, e.g., computation, data storage, correspondence, communication, entertainment, etc. The regular use of computers and data storage devices in daily business operations makes it difficult and impractical to isolate specific scientific functions and their related costs with a high degree of accuracy.
Desktops, laptops and data storage devices below the capitalization threshold ($5,000) are generally considered to support a variety of activities and cannot be linked to one specific project. Therefore, computers are typically treated as indirect costs.
Examples of computers that should be considered indirect costs:
- Computers that are assigned routinely to students, staff or faculty members.
- Computers located in any generally accessible area in a lab or office space.
When may computers or data-storage devices be charged as direct costs?
As stated in the Uniform Guidance, §200.453(c), a computer or data storage device may be charged as a direct cost if the purchase will be "essential and allocable, but not solely dedicated, to" a specific sponsored research project and will not be used as general-purpose equipment.
Examples of computers that can be charged as direct costs:
- A computer that is physically attached to another piece of scientific equipment and/or is required for collection and analysis of information/data.
- A laptop that is essential and allocable to recording data in field research.
- A computer that is essential, allocable and used primarily on a designated sponsored project.
If you plan to charge computers or software to a sponsored project as a direct cost:
- Conform to restrictions and approval requirements outlined in the terms and conditions of the award.
- Provide a written budget justification to explain how the computer is essential and allocable to its specific purpose related to the scientific scope of the work.
- The computer must be purchased early in the project and not in the last six months of the project.