Equipment Purchased with Federal Funds

Guidelines for Equipment Purchased with Federal or Federal-Pass-Thru Funds

The Federal definition of equipment is: tangible personal property (including information technology systems) having a useful life of more than one year and a per-unit acquisition cost which equals or exceeds the lesser of the capitalization level established by the non-Federal entity for financial statement purposes, or $5,000.   UNL’s policy is to capitalize items at $5,000.

UNL retains a conditional title to Equipment purchased with Federal funds unless the awarding agency notifies UNL of its intent to retain title. The equipment can be used in the project or program for which it was acquired as long as needed after the ending date of the grant or contract.

Before using the equipment for other activities or disposing of the equipment, please contact Sponsored Programs if the equipment is in working condition. Items not in working condition may be disposed of following UNL guidelines.

For items in working condition, Sponsored Programs will need a current fair market value of the item, the sponsor and grant number where the item was purchased.  If the item was purchased with multiple funding sources, that information should be provided as well. If the intent is to use the proceeds from the sale of the item to purchase replacement equipment, that should also be indicated in the paperwork sent to Sponsored Programs.  Note that replacement equipment should have the same major functionality as the original equipment.  Sponsored Programs will review the documentation and if appropriate,  will assist the department in requesting disposition instructions from the Federal awarding agency.  Disposition can include returning the item to the sponsor or compensating the sponsor for the item.  Sponsored Programs will assist the department in determining the amount of compensation that needs to be paid to the Federal Agency if the equipment is to be used for other activities.