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National Institutes of Health Salary Cap Increase

April 6, 2016

The National Institutes of Health (NIH) has increased the NIH Salary Cap by 1% to 185,100 effective January 10, 2016. The salary cap is a mandated provision of Congress that limits the amount of salary that can be charged to an NIH grant or contract.  Salaries above the $185,100 limit must be allocated to the impacted grant’s cost share fund (281XXX).

The previous salary cap of $183,300 must still be used for all effort reporting periods prior to December 31, 2015, and for the period from January 1, 2016 through January 09, 2016. Effective January 10, 2016, the new, higher rate can be used. In order to appropriately allocate the new salary cap, you will need to pro-rate, via a labor redistribution, the cost sharing of salaries for the month of January 2016 based on the effective date of the increase.

Although NIH will not be adjusting awards already issued in FY 2016, re-budgeting will be allowed to reflect the increase in the salary cap.

The full context of the NIH guidance can be found at: https://grants.nih.gov/grants/guide/notice-files/NOT-OD-16-045.html