In legal terms, "supplies" refers to tangible, expendable personal property that is directly charged to a grant or award. These items typically have a useful life of less than one year or an acquisition cost of less than $5,000 per unit. This definition is important in the context of federal grants, where understanding what qualifies as supplies can affect budgeting and compliance.
The term "supplies" is primarily used in the context of federal grant regulations, particularly under the Department of Defense guidelines. It is relevant in various legal areas, including administrative law and federal funding compliance. Users may encounter this term when managing grants or agreements with for-profit organizations, where proper classification of expenses is crucial. For those seeking to navigate these regulations, tools like US Legal Forms can provide templates and resources to assist with compliance.
Here are a couple of examples of abatement:
Example 1: A nonprofit organization receives a federal grant to provide educational services. They purchase classroom supplies like notebooks and pens, which cost less than $5,000 each and will be used within the year. These items qualify as supplies under the grant.
Example 2: A research institution uses grant funds to buy laboratory materials such as reagents and test tubes, all of which are consumed in experiments within a year. These too are classified as supplies. (hypothetical example)
| Term | Definition | Key Differences |
|---|---|---|
| Equipment | Durable items used for longer periods, typically over one year. | Equipment has a longer useful life and higher cost threshold than supplies. |
| Materials | Raw goods or components used in the production of goods. | Materials are often not directly charged to a grant but are used in the creation of finished products. |
If you are managing a grant and need to classify purchases as supplies, ensure that the items meet the criteria of being tangible, expendable, and within the cost limits. Consider using US Legal Forms for templates that can help you document these expenses correctly. If you find the regulations complex, consulting a legal professional may be beneficial.
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Supplies must be tangible items with a useful life of less than one year or a cost of less than $5,000 per unit.