45 CFR Part 75: Repeal, Cost Rules, and Single Audit

45 CFR Part 75 no longer exists. As of October 1, 2025, the Department of Health and Human Services repealed its standalone codification of the Uniform Guidance and fully adopted the government-wide version at 2 CFR Part 200, keeping only a short list of HHS-specific modifications at the new 2 CFR Part 300.¹ If you manage an HHS grant or cooperative agreement, your governing regulations are now 2 CFR 200 and 2 CFR 300. Older award documents, agency manuals, and terms and conditions that still reference 45 CFR 75 point to the corresponding sections in the new location.

Why the Repeal Happened and What Moved Where

For years HHS kept its own parallel copy of the Uniform Guidance in 45 CFR Part 75 instead of pointing to the OMB version at 2 CFR Part 200. When OMB revised 2 CFR 200, HHS’s mirror version lagged, and recipients had to reconcile two texts that were supposed to say the same thing. An October 2024 final rule ended that arrangement.¹

Most section numbers translate directly. The old rule on financial management, 45 CFR 75.302, is now 2 CFR 200.302. Record retention moved from 45 CFR 75.361 to 2 CFR 200.334. The audit subpart is still Subpart F. HHS kept only twelve agency-specific modifications, which now live in 2 CFR Part 300 and cover topics such as conflict of interest, payment procedures, intangible property, indirect cost provisions for hospitals, and shared responsibility payments.¹ For any provision not addressed in 2 CFR 300, the plain text of 2 CFR 200 controls.²

Who the Rules Apply To

The regulations cover every non-federal entity that receives or manages an HHS award. That means states, local governments, Indian Tribes, institutions of higher education, and nonprofit organizations, whether they hold the award directly as a recipient or receive it through a pass-through entity as a subrecipient.³ Award terms and conditions flow down to subrecipients unless a specific section says otherwise.⁴ For-profit organizations can receive HHS awards, but they operate under special provisions rather than the full framework applied to nonprofits and governments.

What’s Exempt

Not every dollar of HHS funding triggers the full regulatory package. The cost principles in Subpart E do not apply to fixed-amount awards, agreements for loans, loan guarantees, interest subsidies, and insurance, grant agreements providing food commodities, or awards to hospitals (hospitals follow a separate set of cost principles in Appendix IX). Fixed-price contracts and subcontracts awarded under the Federal Acquisition Regulation are exempt from the audit requirements in Subpart F. Where Cost Accounting Standards apply to a contract, those standards take precedence over the Uniform Guidance except for audit requirements.⁴

Financial Management, Internal Controls, and Procurement

The substantive requirements carried over from 45 CFR 75 with the same structure. Your financial management system has to identify every federal award received and spent, track the source and use of funds for each federally funded activity, and produce accurate financial reports on demand.⁵ An auditor should be able to trace any expenditure from the general ledger back to a source document like an invoice or payroll record.

Internal controls should align with either the GAO Green Book (“Standards for Internal Control in the Federal Government”) or the COSO “Internal Control–Integrated Framework.”⁶ Those controls now include a cybersecurity component: you must take reasonable measures to safeguard personally identifiable information and any data the awarding agency designates as sensitive.

Procurement follows your own written procedures as long as they conform to the federal standards.⁷ The regulations set tiered methods by transaction size. Organizations can self-certify a micro-purchase threshold up to $50,000 annually; thresholds above that require approval from the cognizant agency for indirect costs.⁸ Between the micro-purchase threshold and the simplified acquisition threshold, informal methods like collecting price quotes from multiple vendors are acceptable. Larger procurements require formal competition, and you have to keep records showing you followed your own procedures and obtained fair pricing.

Allowable Costs and Indirect Cost Rates

A cost is allowable only if it is necessary and reasonable for the performance of the award and allocable to the specific project being funded. Reasonable means a prudent person would have incurred the same cost under similar circumstances. Allocable means the cost has a documentable connection to the funded project rather than to your general operations. The total cost of an award equals allowable direct costs plus allocable indirect costs, minus applicable credits such as purchase discounts, rebates, or recoveries. Failing to subtract those credits is a common audit finding that produces disallowed costs.⁹

One notable change in the 2024 revisions: organizations without a federally negotiated indirect cost rate can elect a de minimis rate of up to 15 percent of modified total direct costs, raised from the previous 10 percent.¹⁰ The de minimis rate requires no supporting documentation, and federal agencies and pass-through entities cannot force you to use a lower rate than your negotiated rate or the rate you elected under this provision.

Reporting and Record Retention

Recipients submit financial reports (typically the SF-425) and performance reports on a schedule set by the awarding agency. Performance reports can be required no more frequently than quarterly and no less frequently than annually. Quarterly and semiannual reports are due within 30 calendar days after the reporting period; annual reports are due within 90 calendar days.¹¹ Reports compare actual accomplishments against the objectives set for the period, and explain shortfalls or unusual cost figures when they occur.

Financial records, supporting documents, and other award-related records must be kept for three years from the date you submit your final financial report.¹² The clock stops when a claim or audit begins before the three years run out, and the retention obligation continues until findings are resolved. Records for real property and equipment must be retained for three years after final disposition. Written notice from the awarding agency can extend the period further.¹³

Single Audit Threshold

Any non-federal entity that spends $1,000,000 or more in federal awards during its fiscal year must undergo a Single Audit. The 2024 revisions raised the threshold from $750,000.¹⁴ Below that amount, no federal audit is required for the year. The Single Audit examines both your financial statements and your compliance with federal program requirements, and it requires a Schedule of Expenditures of Federal Awards listing every federal program and the amount spent under each.¹⁵

You submit the data collection form and reporting package to the Federal Audit Clearinghouse within the earlier of 30 calendar days after receiving the auditor’s report or nine months after the end of the audit period.¹⁵ These submissions are public. Missing the deadline can bring additional scrutiny and specific conditions on future awards.

Remedies for Non-Compliance

When a recipient fails to comply with statutes, regulations, or award terms, the awarding agency has a graduated set of tools. It will typically start with specific conditions such as additional reporting, more frequent monitoring, or activity restrictions. If those measures do not resolve the problem, the agency can escalate:¹⁶

Temporarily withholding cash payments pending correction.
Disallowing costs tied to the non-compliant activity, which triggers repayment.
Suspending part or all of the award, or terminating it.
Initiating suspension or debarment proceedings that can bar the organization from all federal awards.
Withholding future awards or continuation funding.

You have the right to challenge these actions. The awarding agency must give you an opportunity to object and submit documentation, following the agency’s written procedures. For HHS specifically, appeals may proceed through the Public Health Service Appeals Procedures or the HHS Departmental Appeals Board, depending on the type of action involved.¹⁷

Termination

An award can be terminated in whole or in part. The awarding agency can terminate for cause, both parties can agree to terminate by mutual consent with negotiated timing, or the recipient can initiate termination through written notice explaining the reasons and effective date.¹⁸ If a recipient partially terminates and the agency later determines the remaining work cannot accomplish the award’s purpose, the agency can convert the partial termination into a full one.

Closeout

When the period of performance ends, recipients submit all final financial, performance, and other required reports within 120 calendar days. Subrecipients face a tighter 90-day deadline (or an earlier date agreed with the pass-through entity). The awarding agency can approve extensions when justified.¹⁹

Closeout does not lock the books. After receiving final reports, the awarding agency must make all necessary adjustments to the federal share of costs, including disallowing costs discovered after closeout or deobligating any unliquidated balance.¹⁹ That is why the three-year retention clock matters even after an award feels finished.

1
Federal Register. Health and Human Services Adoption of the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards
2
U.S. Department of Health and Human Services (HRSA). HHS Regulation Changes Overview
3
eCFR. 2 CFR 200.1 – Definitions
4
eCFR. 45 CFR 75.101 – Applicability
5
eCFR. 45 CFR 75.302 – Financial Management and Standards for Financial Management Systems
6
eCFR. 2 CFR 200.303 – Internal Controls
7
eCFR. 45 CFR 75.327 – General Procurement Standards
8
eCFR. 2 CFR 200.320 – Procurement Methods
9
Department of Health and Human Services. 45 CFR Part 75 – Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HHS Awards
10
eCFR. 2 CFR 200.414 – Indirect Costs
11
eCFR. 2 CFR 200.329 – Monitoring and Reporting Program Performance
12
eCFR. 2 CFR 200.334 – Record Retention Requirements
13
eCFR. 45 CFR 75.361 – Retention Requirements for Records
14
eCFR. 2 CFR Part 200 Subpart F – Audit Requirements
15
Office of Inspector General. Single Audits FAQs
16
eCFR. 2 CFR 200.339 – Remedies for Noncompliance
17
eCFR. 45 CFR 75.374 – Opportunities to Object, Hearings, and Appeals
18
eCFR. 45 CFR 75.372 – Termination
19
eCFR. 2 CFR 200.344 – Closeout