What is “Fringe”?

This is not “fringe” in grant writing budgets, unfortunately!
(Image by Lutz Dieckmann from Pixabay)

For grant writing, the Federal government uses the phrase “fringe” but they really mean the payroll taxes and basic benefits employers have to pay by law. It’s unlikely that they, or very many other funders, are going to fund actual “fringe benefits” like you and I think of fringe (corner office, paid vacations, travel allowance, premium insurance plans, etc).

In 2021, for my nonprofit clients, we have been using a “fringe” rate of about 22% for full-time salaried employees and about 5%-9% for part-time or hourly employees, based on annual salaries or compensation. The fringe rate is higher for full-time employees because you are generally subject to paying more taxes and benefits for full-time, salaried employees. These rates will vary by state, depending on payroll tax rates and federal vs. state requirements for employee benefits such as health care insurance, paid time off, family leave requirements and so forth. If you are in Oregon, you can go with these rates for your grant writing project budget and see if they make sense. If you are outside of Oregon, or if it’s too much past 2021, then check with a local accountant or bookkeeper for guidance.