How to Fill Out and Submit the PHS 398 Budget Form: NIH Grants

The PHS 398 Budget Form is the line-item financial template that some NIH applications require in place of the simpler modular budget. To fill out the PHS 398 Budget Form, you complete Form Page 4 for the initial budget period and a Form Page 5 for each additional year of the project, entering personnel, equipment, travel, supplies, and other direct costs under the rules set by NIH and federal cost principles, then add indirect costs and a narrative justification that explains every number. Your Funding Opportunity Announcement will confirm whether this detailed form is the one you need.¹

Confirm This Is the Right Budget Form

Not every NIH application uses the detailed budget. The PHS 398 detailed form typically appears in FOAs for P-series program projects, T-series training grants, and other mechanisms that require itemized costs. Most standard research grants (R01, R21) from domestic organizations requesting $250,000 or less per budget period in direct costs use the PHS 398 Modular Budget instead, where you request funds in $25,000 modules with no line-item detail.² Applications requesting more than $250,000 per period generally use the R&R Budget form. Check the FOA before you start.

Section A: Personnel

List every person who will work on the project, including those for whom you are not requesting salary. For each individual, enter name, role (PI, co-investigator, postdoc, technician, and so on), and institutional base salary. Institutional base salary is the total annual compensation your employer guarantees; it includes administrative stipends for duties like directing a center or chairing a department, but excludes fringe benefits and indirect costs.³

Effort is expressed in calendar months, or split into academic and summer months, showing how much time each person will devote to the project. A postdoc working half the year gives you six calendar months of effort. The salary you request equals that proportion of the base salary, subject to the NIH salary cap.

Applying the Salary Cap

Federal appropriations law restricts the direct salary NIH grants can pay any individual to Executive Level II of the Federal Executive Pay scale. Effective January 11, 2026, the cap is $228,000. If someone’s institutional base salary is $300,000 and they devote six calendar months to the project, calculate the salary charge as if their base were $228,000: you request $114,000, not $150,000. Institutions cannot draw down funds to pay above this rate and must apply the cap consistently across funding sources.⁴

Fringe Benefits

Enter fringe benefits for each person below their salary line: health insurance, retirement contributions, Social Security, and similar employer-paid costs. NIH sets no ceiling on fringe rates; use whatever rate your institution has established. Your sponsored programs office can confirm the applicable rate.³ All personnel costs must be reasonable and consistent with your institution’s own compensation policies, per federal cost principles.⁵

Section B: Equipment

Equipment is a single tangible item with a useful life of more than one year and an acquisition cost at or above the applicable threshold. Historically that threshold was $5,000 per unit, and many institutions still use it. NIH now recognizes an updated $10,000 threshold under 2 CFR 200.313(e), but only if your institution’s current negotiated indirect cost rate agreement cites the higher amount.⁶ Confirm with your grants office before assuming the $10,000 line applies. Items below your institution’s threshold — glassware, reagents, small instruments — belong in supplies.

List each piece of equipment separately with its cost. Your justification will need to explain why existing institutional resources cannot serve the same purpose and why the specific model or specifications fit the proposed experiments.

Sections C and D: Travel and Supplies

Travel covers transportation, lodging, and meals for trips directly tied to the project: visiting a collaborator’s lab, presenting findings at a conference, or collecting field data. Budget domestic travel using GSA per diem rates for the destination city, and international travel using State Department rates. One rule catches applicants off guard: the Fly America Act generally requires that international air travel paid with federal funds use a U.S. flag air carrier. Noncompliant tickets are not reimbursable.⁷

Supplies are consumable materials: chemicals, animal costs, software licenses under the equipment threshold. Group them into meaningful categories such as “laboratory chemicals” or “animal purchase and per diem” and estimate annual costs by category rather than itemizing every tube and reagent.

Section F: Other Direct Costs

This section holds cost types that do not fit the earlier categories.

Consultant Fees

Grant funds can pay consultant fees, including the consultant’s travel and per diem.⁸ NIH does not set a daily rate ceiling. The rate needs to be reasonable, consistent with what the consultant charges other clients, and justifiable given their expertise. Explain in the justification what specialized skills the consultant brings that your team lacks.

Subawards and Consortium Costs

When another institution performs a substantive portion of the research, that arrangement is a subaward, sometimes called consortium costs. The subawardee prepares its own detailed budget pages, which you incorporate into your application. As the lead applicant, you are accountable to NIH for the appropriate expenditure of all funds, including those flowing to consortium partners. You must have a written agreement with each partner covering how you will monitor research progress, reimburse costs, and handle reporting and audit requirements.⁹ The lead institution must play a real scientific role; it cannot function as a pass-through.

Publication Costs

Article processing charges for open-access publication are allowable. Across NIH applications, the average requested cost per publication runs roughly $2,500 to $3,100, though journal fees vary widely, from zero to $12,000 or more.¹⁰ NIH has signaled that it will cap allowable publication costs, with a proposed effective date in 2026 and options under consideration ranging from $2,000 to $6,000 per paper.¹¹ Check current NIH Guide notices before finalizing this line.

Data Management and Sharing

Under NIH’s Data Management and Sharing Policy, you can budget reasonable costs for curating data, de-identifying records, formatting files to community standards, preparing metadata, and paying repository deposit fees. These costs go in the appropriate category (personnel time in Section A, deposit fees in Other Direct Costs), but you must also include a separate Data Management and Sharing Justification in your budget justification attachment, no longer than half a page, describing the type and volume of data, the planned repository, and estimated costs by category.¹² You cannot charge infrastructure already covered by your indirect cost rate, and you cannot charge the routine costs of collecting or generating the data itself — only preparing, preserving, and sharing it.

Visa Costs

Short-term and long-term visa fees for project personnel are generally allowable as a direct cost, provided the institution has an employer-employee relationship with the individual.¹³

Section G: Indirect Costs

Indirect costs, formally called Facilities and Administrative (F&A) costs, cover shared institutional expenses that support research but cannot be tied to a single project: building maintenance, utilities, library access, departmental administration. To claim them, your institution needs a Negotiated Indirect Cost Rate Agreement with the federal government. The agreement specifies a percentage applied to modified total direct costs.

Organizations without a negotiated rate may elect a de minimis rate of up to 15 percent of modified total direct costs. This rate requires no supporting documentation and can be used indefinitely until the organization negotiates a formal rate.¹⁴ On the form, enter the rate, the base it applies to, and the calculated dollar amount.

Multiple Budget Periods and the Cumulative Page

Fill out a separate budget page for each year of the proposed project. Form Page 4 covers the initial period; Form Page 5 covers each subsequent year. A five-year project has five sets of budget figures. Annual costs typically change: a postdoc joins in Year 2, a major equipment purchase happens only in Year 1, so each period should reflect the actual anticipated spending for that year.

The cumulative budget page sums the individual periods automatically. If a total looks wrong, correct it in the specific year where the error occurred rather than editing the cumulative page directly.¹⁵ Verify that line items add up before moving on. Mismatches between individual periods and cumulative totals are a common validation error.

Writing the Budget Justification

The budget justification is a narrative attachment that explains why every dollar you requested is necessary. Reviewers read it alongside the numerical tables, and a weak justification is one of the fastest ways to get your budget cut. Organize it to follow the same categories as the form.

Personnel: describe each person’s specific duties and how their expertise contributes to the aims. If someone is listed at 3 calendar months, the justification should make clear what they are doing during that time.
Equipment: explain why existing institutional equipment cannot serve the purpose and link the specifications to experiments in the research plan. A $50,000 microscope with no clear scientific rationale will draw scrutiny.
Travel: identify planned trips, purpose, and how estimated costs were calculated (for example, GSA per diem for Washington, D.C., plus round-trip airfare).
Consultants: name the consultant, describe the specialized skills they bring, and state the proposed rate and duration.
Subawards: briefly explain the partner’s role and how their work connects to the project. Their own detailed budget and justification accompany the application.
Data management and sharing: include the separate half-page Data Management and Sharing Justification with estimated costs by category.¹²

Costs You Cannot Charge

Certain expenses are categorically unallowable. The NIH Grants Policy Statement identifies prohibited categories, and 45 CFR Part 75 sets the broader cost principles.¹⁶ Several trip applicants up regularly:

Entertainment: social events, meals unrelated to project activities, and hospitality expenses.
Lobbying: any costs related to influencing legislation or regulation.
Profit or fee: NIH does not provide profit to recipients under any grant mechanism, with the sole exception of SBIR/STTR awards. You also cannot pay a fee to a consortium participant.
Double-charged costs: an expense covered by your F&A rate cannot also be charged as a direct cost. If your indirect pool already includes general office supplies or administrative support, listing them again as direct costs is prohibited.

Including unallowable costs can lead to disallowance of the charges, suspension, or termination of the award. Deliberate falsification or misrepresentation can result in debarment and potential criminal penalties.¹⁷

Submitting the Budget

NIH applications, including the PHS 398 budget, are submitted electronically through ASSIST, Grants.gov Workspace, or your institution’s system-to-system solution. You do not upload directly to eRA Commons. Once your institution’s Authorized Organizational Representative submits, the application passes through Grants.gov and is then retrieved by NIH’s eRA systems for validation.¹⁸

Validation flags two types of issues:

Errors are showstoppers. Missing mandatory fields, mathematical inconsistencies between budget pages, or formatting violations block the application. You must submit a changed or corrected version addressing all errors before the deadline.
Warnings do not stop the application, but ignoring them is risky. NIH staff can withdraw an application if a warning points to a genuine problem. Review each one.

If validation finds no issues, a consolidated document of your submitted forms and attachments appears in eRA Commons. You have two business days to review it before the application moves to NIH staff for processing.¹⁸

After the Award: Rebudgeting Rules

Once your grant is funded, the budget is not permanently locked. NIH allows some rebudgeting without prior approval, but certain changes require permission from the Grants Management Officer before you spend.

Prior approval is required when rebudgeting into alterations and renovations would exceed 25 percent of the total approved budget for a period, when rebudgeting would change the project’s scope, when moving funds away from trainee costs, or when shifting between construction and non-construction categories.¹⁹ NIH also treats spending in any single direct cost category that deviates from the approved amount by 25 percent or more of total costs awarded as “significant rebudgeting,” which can trigger administrative review.

Carryover of unspent funds follows different rules by mechanism. Many R-series awards allow automatic carryover; P-series and certain U-series grants often require prior approval, which your Notice of Award will specify. An unobligated balance exceeding 25 percent of the current year’s approved budget must be justified in your Research Performance Progress Report along with a plan to spend it down.

1
National Institutes of Health. Instructions and Form Files for PHS 398
2
National Institutes of Health. G.320 – PHS 398 Modular Budget Form
3
National Institutes of Health. Develop Your Budget
4
National Institutes of Health. Guidance on Salary Limitation for Grants and Cooperative Agreements FY 2026
5
Legal Information Institute. 45 CFR Part 75 – Subpart E Cost Principles
6
National Institutes of Health. NOT-OD-25-059 NIH Implementation of Uniform Administrative Requirements
7
General Services Administration. Fly America Act
8
National Institutes of Health. NIH Grants Policy Statement – 14.10 Allowable and Unallowable Costs
9
National Institutes of Health. Subawards
10
National Institutes of Health. Request for Information on Maximizing Research Funds by Limiting Allowable Publishing Costs
11
National Institutes of Health. NIH to Establish New Policies for Allowable Publication Costs
12
National Institutes of Health. Budgeting for Data Management and Sharing
13
National Institutes of Health. NIH Grants Policy Statement – Allowable and Unallowable Costs
14
eCFR. 2 CFR 200.414 – Indirect (F&A) Costs
15
National Institutes of Health. G.330 – PHS 398 Training Budget Form
16
National Institutes of Health. Allowability of Costs/Activities
17
National Institutes of Health. Instructions for Grant Applications Using PHS 398
18
National Institutes of Health. How to Submit, Track, and View Your Application
19
National Institutes of Health. Prior Approval Requirements