{"data":{"id":"us/48-cfr-231.205-18","jurisdiction":"us","citation":"48 CFR 231.205-18","heading":"231.205-18 Independent research and development and bid and proposal costs.","body":"(a) Definitions. As used in this section—\nCovered contract means a DoD prime contract for an amount exceeding the simplified acquisition threshold, except for a fixed-price contract without cost incentives. The term also includes a subcontract for an amount exceeding the simplified acquisition threshold, except for a fixed-price subcontract without cost incentives under such a prime contract.\nCovered segment means a product division of the contractor that allocated more than $1,100,000 in independent research and development (IR\u0026D) costs and bid and proposal (B\u0026P) costs to covered contracts during the preceding fiscal year. In the case of a contractor that has no product divisions, the term means that contractor as a whole. A product division of the contractor that allocated less than $1,100,000 in IR\u0026D costs and B\u0026P costs to covered contracts during the preceding fiscal year is not subject to the limitations in paragraph (c) of this section.\nMajor contractor means any contractor whose covered segments allocated a total of more than $11 million in IR\u0026D costs and B\u0026P costs to covered contracts during the preceding fiscal year. For purposes of calculating the dollar threshold amounts to determine whether a contractor meets the definition of “major contractor,” do not include contractor segments allocating less than $1,100,000 of IR\u0026D and B\u0026P costs to covered contracts during the preceding fiscal year.\n(c) Allowability. (i) Departments/agencies shall not supplement this regulation in any way that limits IR\u0026D cost allowability and B\u0026P cost allowability.\n(ii) See 225.7303-2(c) for allowability provisions affecting foreign military sale contracts.\n(iii)(A) For IR\u0026D costs major contractors incurred on covered contracts to be allowable—\n(1) The contractor is required to report IR\u0026D projects generating the IR\u0026D costs to the Defense Technical Information Center (DTIC) using the DTIC's online input form and instructions at https://defenseinnovationmarketplace.dtic.mil/industry-portal/; and\n(2) The contractor is required to update its DTIC inputs at least annually, no later than 3 months after the end of the contractor's fiscal year, and when the project is completed.\n(B) The amount of IR\u0026D costs allowable under DoD contracts shall not exceed the lesser of—\n(1) Such contracts' allocable share of total incurred IR\u0026D costs; or\n(2) The total amount of incurred IR\u0026D costs that the chief executive officer of the contractor has determined will advance the needs of DoD for future technology and advanced capability as DoD describes such needs in communications referenced at 242.771-3(c)(1)(i).\n(C) Contractors that are not major contractors are encouraged to use the DTIC online input form and instructions at https://defenseinnovationmarketplace.dtic.mil/industry-portal/ to report IR\u0026D projects in order to provide DoD with visibility into the technical content of the contractors' IR\u0026D projects.\n(iv) Contractors are required to report incurred IR\u0026D costs separately from indirect costs.\n(v) Contractors are required to report incurred B\u0026P costs separately from other indirect costs.","path":["Title 48—Federal Acquisition Regulations System","CHAPTER 2—DEFENSE ACQUISITION REGULATIONS SYSTEM, DEPARTMENT OF DEFENSE","SUBCHAPTER E—GENERAL CONTRACTING REQUIREMENTS","PART 231—CONTRACT COST PRINCIPLES AND PROCEDURES","Subpart 231.2—Contracts With Commercial Organizations"],"source_url":"https://www.ecfr.gov/api/versioner/v1/full/2026-08-25/title-48.xml","current_through":"2026-08-25","vintage":"","retrieved_at":"2026-08-27T02:26:29Z","sha256":"a9f8dd4ce6c36606f760b45ef977ed0a8156b514793f29cdf64596e57e3b2d97","source_id":"us-cfr","stale":true,"prev":"us/48-cfr-231.205-6","next":"us/48-cfr-231.205-19"},"notice":"GroundRules: Original legal text. Not legal advice."}