In a year with as many financial obstacles as 2020, it is vital for nonprofits with New York City funded programs to get the best Indirect Cost Rate (ICR) possible.
Organizations have until December 31, 2020 to submit verification documentation through their vendor profile in PASSPort to establish a more beneficial ICR.
Grassi’s Not-for-Profit advisors can help you maximize your rate through performing an ICR audit or reviewing your classification of expenses in conformity with the provisions of the NYC Health and Human Services Cost Policies and Procedures Manual, which allows for establishing your rate in one of three ways:
- Maximizing your ICR under the city’s 10% De Minimis ICR Policy through better allocation of costs (verification documentation not required).
- Achieving an ICR higher than 10% through an Independent Accountant’s Report, which identifies ways to classify and reclassify overhead expenses that might have previously been applied incorrectly to programs.
- Utilizing your Negotiated Indirect Cost Rate Agreement (NICRA) to establish a higher ICR.
Once an organization obtains an Independent Accountant’s Report or NICRA, it can claim an ICR higher than 10% and receive additional funding by completing the Entryway Choice Form. You will have the lesser of 30 days after submission or December 31 to facilitate amendment registration.
The ICR you establish for 2021 will be secured for the next three years, making this step a crucial component of your pandemic recovery plan.
Please contact your Grassi Not-for-Profit advisor or Jaime Rapps at 212.223.5017 or jrapps@grasicpas.com to learn more.
