The formulas
- Fair market value of $10,000 or less per unit: no amount due
- Above $10,000: federal amount = federal % of original purchase x (sale proceeds, or current fair market value if retained)
- If sold and permitted, $1,000 of the federal share may be retained for selling and handling
How it works
Under 2 CFR 200.313(e), equipment no longer needed for the original project or other federally supported activities is disposed of under the agency's instructions. Equipment with a current fair market value of $10,000 or less per unit may be retained, sold or otherwise disposed of with no further responsibility. Above $10,000 per unit, the recipient may retain or sell it, and the federal agency is entitled to its percentage of the original purchase times the current market value or the sale proceeds.
When the equipment is sold, the agency or pass-through entity may permit the recipient to keep $1,000 of the federal share for selling and handling expenses. Where the award terms require it, the recipient requests disposition instructions and follows them; if instructions do not arrive within 120 days, equipment above $10,000 per unit may be kept or sold and the federal share paid.
Illustrative figures only. Check the result against your firm's methodology before relying on it.
Common questions
Is the $10,000 test on cost or current value?
On current fair market value per unit at disposition, not on original cost.
What if the agency does not answer a request for instructions?
If instructions are not provided within 120 days, the recipient may retain or sell equipment above $10,000 per unit, and the federal share is still due.
Sources
Runs in your browser. The figures you type are not sent to CORAA or stored. Check the result against your firm's methodology before relying on it.