Glossary of grant terms

Grant applications, foundation filings and federal award documents use a vocabulary of their own. Here are 40 terms that come up often, each defined in plain words with a link to a GrantCue guide that goes further, and the federal terms follow the wording of 2 CFR 200 and 2 CFR 25 as published on eCFR (read October 2026).

0-9

990-PF

Form 990-PF is the annual return every U.S. private foundation files with the IRS. It lists the grants the foundation paid during the year, with each recipient's name, address, purpose and amount, and it says whether the foundation gives only to organizations it selects itself. Because the returns are public, they are the main record of a foundation's past giving.

Source: IRS, About Form 990-PF

B

Budget justification

The written explanation of each line in a grant budget: what the cost is, how the figure was calculated and why the project needs it. Many funders call it a budget narrative. Federal notices of funding opportunity usually say what format they expect.

C

Capacity building

Funding or help that strengthens the organization itself rather than one program, such as planning, staff training, financial systems, technology or board development. Some foundations run grant programs only for this.

Community foundation

A public charity that pools gifts from many donors to make grants in one city, county or region. Many of its grants are recommended by donors who hold donor-advised funds there, alongside its own competitive grant programs. Community foundations file Form 990, so their grants appear on Schedule I rather than on a 990-PF.

Cost share or match

The part of a project's cost that the grant does not pay. In federal rules, cost sharing is "the portion of project costs not paid by Federal funds or contributions (unless authorized by Federal statute)," and matching is a required level of cost share. It can be cash or third-party in-kind contributions, and it must be verifiable in your records and not counted toward another federal award.

Source: 2 CFR 200.1 and 200.306, eCFR, read October 2026

D

De minimis rate

A flat indirect cost rate that a federal recipient or subrecipient without a current negotiated rate may charge: up to 15 percent of modified total direct costs (MTDC). The organization chooses its rate up to that limit, and an agency or pass-through entity cannot require a lower one unless a federal statute or regulation does. Using it is optional.

Source: 2 CFR 200.414(f), eCFR, read October 2026

Donor-advised fund

An account held by a sponsoring charity, often a community foundation, into which a donor gives money and later recommends grants from it. The sponsoring charity owns the money and makes the final decision on each grant. On a foundation's 990-PF, a payment into a donor-advised fund can look like a large grant to the charity that holds the fund.

E

EIN (Employer Identification Number)

The nine-digit number the IRS assigns to an organization for tax purposes, written as XX-XXXXXXX. Nearly every grant application asks for it, and funders use it to look up your IRS filings. The IRS issues it free.

Evaluation plan

The part of a proposal that says how you will know whether the project worked: which outcomes you will measure, with what data and methods, who collects the data and when, and how you will report the results.

F

Fiscal sponsor

An established 501(c)(3) organization that receives grants for a project or group without tax-exempt status of its own, then manages the money and the reporting, usually for a fee. It lets a new group apply for grants that require 501(c)(3) status.

G

General operating support

A grant the organization can spend on any part of its work, including rent, salaries and administration, rather than on one project. It is also called unrestricted or core support. Most foundation grants, especially first grants, are restricted to a program instead.

Related: Nonprofit Funding Models

Grant agreement

The signed document that sets the terms of an award, such as the amount, the period, the budget, how payment works and what reports are due. In federal rules, a grant agreement is a legal instrument of financial assistance used to transfer something of value to carry out a public purpose authorized by law, not to buy goods or services for the agency. It differs from a cooperative agreement in that the agency is not substantially involved in the work.

Source: 2 CFR 200.1, eCFR, read October 2026

Grant cycle

The schedule a funder repeats to accept applications, review them, decide and pay. Many foundations run one or more cycles a year with fixed deadlines. People also use the term for the stages of a single grant, from finding it to closing it out.

I

In-kind contribution

A contribution of property or services instead of cash, such as donated space, equipment or professional time. In federal grants, third-party in-kind contributions are non-cash contributions that benefit the funded project and that non-federal third parties give to the recipient or subrecipient without charge. They can count toward a required match.

Source: 2 CFR 200.1 and 200.306, eCFR, read October 2026

Indirect cost rate

The percentage of a base of direct costs that an organization charges to a grant to cover indirect costs. Federal rules define indirect costs as costs incurred for a common or joint purpose that benefit more than one cost objective and cannot readily be assigned to one of them, such as a shared office or accounting staff. A federal recipient uses a rate negotiated with its cognizant agency, which all federal agencies must accept with limited exceptions, or the de minimis rate if it has none.

Source: 2 CFR 200.1 and 200.414, eCFR, read October 2026

Invitation only

Describes a funder that accepts proposals only from organizations it has asked to apply. On Form 990-PF, a foundation says this by checking the box stating that it makes contributions only to preselected charitable organizations and does not accept unsolicited requests.

L

Letter of support

A letter from a partner, public official or community member that backs your application, saying why the project is needed and what the writer will contribute. A letter of commitment goes further and pledges specific resources.

Related: What Is a Letter of Support?

Logic model

A one-page table or diagram that connects a program's inputs (staff, money, space) to its activities, its outputs (what you deliver and count) and its outcomes (the changes you expect). Funders use it to check that the plan hangs together.

LOI (letter of inquiry or letter of intent)

A short letter that describes your organization, the project and the amount you plan to request. Many foundations ask for an LOI first and invite full proposals only from the applicants they want to hear more from. Some federal programs ask for a letter of intent only to estimate how many applications to expect.

M

MTDC (modified total direct costs)

The base that federal indirect cost rates, including the de minimis rate, are applied to. It includes direct salaries and wages, fringe benefits, materials and supplies, services, travel, and up to the first $50,000 of each subaward. It excludes equipment, capital expenditures, charges for patient care, rental costs, tuition remission, scholarships and fellowships, participant support costs, and the part of each subaward above $50,000.

Source: 2 CFR 200.1, eCFR, read October 2026

N

No-cost extension

More time to finish the work of a grant, with no additional money. On a federal award whose terms allow it, the recipient can make a one-time extension of up to 12 months without prior approval, by notifying the agency in writing at least 10 calendar days before the period of performance ends. Other no-cost extensions need the agency's prior approval, and a one-time extension may not be used only to spend leftover funds.

Source: 2 CFR 200.308(f)(10) and (g)(2), eCFR, read October 2026

NOFO (notice of funding opportunity)

A federal agency's formal announcement that funding is available. It says who is eligible, how applications will be evaluated, what an application must include and how to submit it. The rules treat any such announcement as a NOFO, whether the agency calls it a program announcement, a solicitation, a broad agency announcement or something else.

Source: 2 CFR 200.1, eCFR, read October 2026

P

Pass-through entity and subrecipient

A pass-through entity is a recipient or subrecipient that gives a subaward to another organization to carry out part of a federal program. The organization that receives the subaward is the subrecipient. A state agency that passes federal money to counties or nonprofits is a common example. A subrecipient follows most of the same federal rules, and the pass-through entity must monitor it. A business paid to provide goods or services is a contractor, not a subrecipient.

Related: Pass-Through Grant Management

Source: 2 CFR 200.1 and 200.332, eCFR, read October 2026

Private foundation

A charity, usually funded by one person, family or company, that makes grants from its own assets rather than raising money from the public. Private foundations file Form 990-PF each year and must generally pay out about 5 percent of the value of their investment assets.

Program officer

The member of a funder's staff who runs a grant program: answering applicants' questions, reviewing proposals, recommending awards and following the grants once they are made. When a funder invites contact, a short conversation with the program officer before you apply is a good way to learn whether a project fits.

Related: Foundation Proposal Template

Public charity

A 501(c)(3) organization that is supported broadly by the public, by government or by its own program income, or that is a church, school or hospital. Most nonprofits that apply for grants are public charities. Most file Form 990, 990-EZ or the 990-N postcard each year depending on their size; churches do not have to file.

R

Reimbursement grant

A grant that pays you back after you spend the money: you pay the costs first, then request payment with documentation. Federal rules pay recipients other than states in advance when they meet the cash management standards, and prefer reimbursement when they cannot, when the agency sets it as a specific condition, when the recipient asks for it, or for construction. A federal agency or pass-through entity must pay a proper reimbursement request within 30 calendar days.

Related: Pass-Through Grant Management

Source: 2 CFR 200.305(b), eCFR, read October 2026

Reporting period

The span of time a grant report covers, such as a quarter, half year or full year. The grant agreement sets the reporting periods and due dates. For federal financial reports, an annual report is due within 90 calendar days after the period ends, and a quarterly or semiannual report within 30.

Related: Grant Progress Report Template

Source: 2 CFR 200.328(c), eCFR, read October 2026

Restricted funds

Money a donor or funder has limited to a specific purpose or time period. The organization must spend it as agreed and track it separately. In nonprofit financial statements it appears as net assets with donor restrictions.

Related: Nonprofit Funding Models

RFP (request for proposals)

An announcement in which a funder describes what it wants to fund and asks organizations to submit proposals by a deadline. Foundations, states and local governments use the term, and the federal version is usually called a NOFO. Some foundations accept proposals only in answer to an RFP.

Rolling deadline

An application with no fixed due date: the funder accepts and reviews applications as they arrive, until the money is committed or the program closes. Applying early is usually better, because funds can run out before any posted end date.

S

SAM.gov

The System for Award Management, the federal site where organizations register to receive federal awards. Unless exempt, an applicant must be registered before it applies, keep the registration active while it has an application under review or an active award, and review and update its information every year. Registration is free.

Source: 2 CFR 25.200 and 25.400, eCFR, read October 2026

Schedule I (Form 990)

The schedule of Form 990 on which a public charity reports the grants it made. Grants of more than $5,000 to any one domestic organization or government in the year are listed by recipient, with the recipient's EIN, the amount and the purpose. Community foundations and United Ways report their grants here, because they file Form 990 rather than 990-PF.

Source: IRS, About Schedule I (Form 990)

SF-424

The standard Application for Federal Assistance, and the family of forms that go with it, such as the SF-424A budget form. Federal agencies may use only application forms approved by OMB, and the SF-424 family, available on Grants.gov, is the main example.

Source: 2 CFR 200.207(a), eCFR, read October 2026

SF-425

The Federal Financial Report, the government-wide form for reporting the money on a federal award: cash received, spending, what is still unobligated, and the recipient's share. Federal agencies must collect financial reports at least once a year, and the recipient's final report is due within 120 calendar days after the period of performance ends.

Source: 2 CFR 200.328, eCFR, read October 2026

Single audit

An audit of an organization's financial statements and its federal awards together. A state, local government, tribe, college or nonprofit must have one for any fiscal year in which it spends $1,000,000 or more in federal awards. An organization that spends federal money under only one program may in some cases choose a program-specific audit instead.

Related: Single Audit Requirements

Source: 2 CFR 200.501, eCFR, read October 2026

Sustainability plan

The part of a proposal that explains how the work will continue after the grant ends, for example through other funders, earned income, partner commitments or a smaller ongoing budget.

T

Theory of change

A statement of how and why a set of activities is expected to lead to a long-term change, including the assumptions that link each step. It is usually broader than a logic model, which lays out one program's inputs, activities and results.

U

UEI (Unique Entity ID)

The 12-character identifier that SAM.gov assigns to each organization, defined in federal rules as "the universal identifier assigned by SAM.gov to uniquely identify an entity." Applicants include it on every federal application, and subrecipients of federal money must have one too. It replaced the DUNS number in April 2022.

Source: 2 CFR 25.400 and 25.300, eCFR, read October 2026

Unsolicited proposal

A proposal sent to a funder that did not ask for it through an open call, an RFP or an invitation. Some foundations accept them at any time; others say on their 990-PF or website that they do not.