Budget Narrative Template

The budget narrative template above is a complete budget justification organized by the standard federal cost categories, A through I: personnel, fringe benefits, travel, equipment, supplies, contractual, other direct costs, total direct costs, and indirect costs, followed by totals and other committed funds. Every category has a sample line that shows the item, the math, and a one-sentence tie to a project activity, so you can see the pattern before you replace the brackets with your own figures. Edit it in the box, then copy it into your application or download it as a text file.

Figures to update before you use it

Two numbers in the template reflect the federal rules as they stood before the 2024 revision of the Uniform Guidance (2 CFR 200). For federal awards issued on or after October 1, 2024:

• Equipment threshold. The per-unit threshold for equipment rose from $5,000 to $10,000. Items below $10,000 per unit generally belong under supplies unless your organization sets a lower threshold in its own policy.
• De minimis indirect rate. Organizations without a negotiated indirect cost rate may charge up to 15% of modified total direct costs, up from 10%.
• Subawards in the base. Modified total direct costs now include up to the first $50,000 of each subaward, up from $25,000, and still exclude equipment, rental costs, participant support costs, tuition remission, and the portion of each subaward above that amount.

If you have a negotiated rate agreement, use the rate and base it specifies; some institutions keep the older thresholds until their agreement is renegotiated. Also replace the mileage line's rate with the current IRS standard mileage rate, or your organization's lower policy rate if it has one.

Foundation budgets need less, not nothing

Private foundations rarely ask for the full federal category structure. Many want a one-page budget table and a short paragraph per major line, and some cap or refuse indirect costs. For a foundation request, keep the template's habit of showing the math and naming the activity, but collapse categories the funder does not use: fringe often merges into personnel, and equipment and supplies into one line. If the foundation publishes its own budget form, use its categories and its order, even when they differ from the template.

Write it from the budget, not alongside it

The narrative explains numbers that already exist, so build the budget first. Enter your line items and indirect rate in the grant budget builder, confirm the totals, and then write one justification per line here. Check three things before you finish: every subtotal in the narrative matches the budget form, every activity in the project description has a cost, and every cost appears in the project description.

For the method behind the prose and the mistakes reviewers flag most, read our budget narrative guide. To decide which costs are direct and which are indirect, see our guide to classifying direct and indirect costs and our explainer on the indirect cost rate; for federal applications, our SF-424A walkthrough shows where these categories appear on the official form. Our federal grant writers prepare budgets and justifications to each agency's cost rules.