Program Income

Program income means gross income earned by the recipient that is directly generated by a supported activity or earned as a result of the award (see exclusions in Subpart C.24 (e) and (h) of OMB Circular A-110).

Program income includes, but is not limited to, income from fees for services performed, the use or rental of real or personal property acquired under federally funded projects, the sale of commodities or items fabricated under an award, license fees and royalties on patents and copyrights, and interest on loans made with award funds.

Interest earned on advances of federal funds is not program income. Except as otherwise provided in federal awarding agency regulations or the terms and conditions of the award, program income does not include the receipt of principal on loans, rebates, credits, discounts, etc., or interest earned on any of them.

If there is program income, determine which type of program income is applicable. Refer to OMB Circular A-110, Subpart C.24, for additional information.

Generally, program income on federal awards may be used in one of three methods:

  • Deducted from project expenditures to determine the net allowable federal share of costs
  • Added to the project budget to further eligible project or program objectives
  • Used to meet matching requirements

Program income is reportable. The federal awarding agency regulations or the terms and conditions of the award should be reviewed for any specific language regarding program income. Unless provided other by the awarding agency, recipients shall have no obligation to the Federal Government with respect to program income earned after the end of the project period.