Understanding Cost-Sharing and Matching Fund Requirements

Matching funds — also called cost-sharing — are a common grant requirement that trips up many applicants. Here's everything you need to know.

What Are Matching Funds?

Matching funds are your contribution to a grant-funded project. When a funder requires a "match," they're asking you to invest alongside them.

Example:

• Grant award: $100,000
• Required match: 25%
• Your contribution: $25,000
• Total project: $125,000

Types of Match

Cash Match

Actual dollars you spend:

• Direct organizational funds
• Other grants (if allowed)
• Donations specifically for this project
• Revenue from project activities

In-Kind Match

Non-cash contributions with monetary value:

• Staff time (at actual salary rates)
• Volunteer time (at fair market rates)
• Donated equipment or supplies
• Donated space or facilities
• Professional services

How to Calculate Match

The Formula

Match Amount = Grant Request × Match Rate ÷ (1 - Match Rate)

Or more simply:

Match Requirement	Grant Request	Your Match
10%	$100,000	$11,111
20%	$100,000	$25,000
25%	$100,000	$33,333
50%	$100,000	$100,000

Valuing In-Kind Contributions

Staff time:

Hourly rate × hours worked = Value Example: $30/hour × 100 hours = $3,000

Volunteer time: Use Independent Sector's value (~$30/hour for general volunteers, higher for professional services)

Donated goods: Fair market value (what you'd pay retail)

Donated services: What you'd pay for equivalent professional services

Donated space: Comparable rental rates in your area

Common Match Requirements by Funder

Funder Type	Typical Match
Federal research (NIH, NSF)	0-20%
Federal community grants	25-50%
State programs	10-50%
Private foundations	Varies (often none)
Corporate grants	Often none

Strategies for Meeting Match

1. Leverage Existing Resources

What you're already spending that relates to the project:

• Staff time on related activities
• Office space used for project
• Equipment already owned
• Utilities, insurance, overhead

2. Secure Partner Commitments

Other organizations contributing to your project:

• Partner staff time
• Shared facilities
• Collaborative services
• Subgrant from another funder

3. Value Volunteer Time

Track volunteer hours carefully:

• Create sign-in sheets
• Document activities
• Apply appropriate hourly rates
• Keep contemporaneous records

4. In-Kind Donations

Solicit goods and services:

• Professional services (legal, accounting)
• Supplies and materials
• Equipment loans
• Space donations

5. Other Funding Sources

Layer multiple grants (when allowed):

• Foundation grants
• Corporate sponsorships
• State programs
• Fee revenue

Documentation Requirements

You MUST document match carefully:

For Cash Match:

• Bank statements
• Cancelled checks
• Accounting records
• Grant agreements from other funders

For In-Kind Match:

• Timesheets for staff/volunteers
• Donation letters with values
• Market rate documentation
• Photos of donated goods

For All Match:

• Contemporaneous records (not reconstructed later)
• Clear connection to the project
• Verification that costs are allowable
• Evidence match is from non-federal sources (for federal grants)

Common Mistakes

❌ Double-counting match Can't use same match for multiple federal grants

❌ Using federal funds as match Federal money can't match federal money (with few exceptions)

❌ Unallowable costs Match must meet same cost principles as grant funds

❌ Poor documentation Must be verifiable if audited

❌ Overvaluing in-kind Use realistic, defensible valuations

What If You Can't Meet Match?

Options:

1. Request a waiver Some programs allow match reduction for hardship

2. Phase the project Smaller project = smaller match

3. Find partners Share match burden with collaborators

4. Apply elsewhere Some funders don't require match

5. Build match over time Multi-year projects can spread match

Match Budget Template

Category	Grant Funds	Cash Match	In-Kind Match	Total
Personnel	$50,000	$10,000	$5,000	$65,000
Supplies	$10,000	$0	$2,000	$12,000
Equipment	$15,000	$5,000	$0	$20,000
Other	$5,000	$0	$3,000	$8,000
Total	$80,000	$15,000	$10,000	$105,000

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