NSF does not have a salary cap in the sense NIH does — there is no fixed dollar ceiling tied to the federal Executive pay scale. What NSF has instead is a two-month rule: as a general policy, NSF limits the salary compensation a proposal budget can request for each senior/key person to no more than two months of that person’s own regular salary in any one year, aggregated across all NSF-funded grants that person holds. It is a limit on person-months charged against an individual’s own institutional salary, not a dollar figure set by the government. Last verified: August 16, 2026, directly against NSF’s Proposal & Award Policies and Procedures Guide (PAPPG), NSF 24-1, Chapter II.D.2.f.i.a.
Quick answer
| Question | Answer |
|---|---|
| Is there an NSF salary cap like NIH’s? | No. NIH’s cap is a fixed federal dollar rate (tied to Executive Level II). NSF has no equivalent dollar ceiling. |
| What does NSF actually limit? | The number of months of a senior/key person’s own salary that a proposal budget may request from NSF: no more than two months per year. |
| Two months of what? | The individual’s own regular institutional salary — not a government-set figure. A higher-paid PI’s “two months” is a larger dollar amount than a lower-paid PI’s. |
| Per award or per person? | Per person, aggregated across all NSF-funded grants that person holds in the applicable year — not two months per award. |
| Can it be exceeded? | Yes, if disclosed in the proposal budget, justified in the budget justification, and specifically approved by NSF in the award notice budget. |
| Governing source | NSF PAPPG (NSF 24-1), Chapter II.D.2.f.i.a, “Senior/Key Personnel Salaries & Wages Policy” |
What the NSF two-month rule actually says
NSF’s reasoning starts from a different premise than NIH’s. NSF treats research as one of the normal functions of faculty members at institutions of higher education, and considers compensation for time normally spent on research within the term of a faculty appointment to already be covered by the faculty member’s regular organizational salary. Building on that premise, NSF’s general policy is:
“NSF limits the salary compensation requested in the proposal budget for each senior/key person to no more than two months of their regular salary in any one year.”
A few mechanics that follow directly from the PAPPG text:
- The organization defines “year.” NSF does not prescribe whether “year” means the calendar year, the academic year, or the organization’s fiscal year — it is the recipient institution’s responsibility to define the term consistently and state that definition in the budget justification.
- The limit aggregates across every NSF award the person holds. This includes salary compensation received from all NSF-funded grants, not just the proposal currently being prepared. A PI already drawing 1.5 months of salary from one active NSF award has only 0.5 months of headroom left under this rule for a second NSF award in the same year.
- Effort must be documented in accordance with 2 CFR § 200, Subpart E, including 2 CFR § 200.430(i) — the same effort-documentation framework that underlies effort certification and time and effort reporting more broadly across federal awards.
- These are general principles that also apply to non-academic recipient organizations, per NSF’s own text, even though the “regular organizational salary” framing is written with a faculty appointment in mind.
Worked example (illustrative, not a real award)
The figures below are an illustrative composite built to show the arithmetic, not a real grant or a real person’s compensation.
| Input | Value |
|---|---|
| PI’s institutional base salary (12-month appointment) | $180,000/year |
| Monthly salary rate | $15,000/month |
| Two-month NSF limit | 2 × $15,000 = $30,000 in salary chargeable to NSF awards for that year |
If that same PI holds a second active NSF award and has already charged 1 month ($15,000) of salary to it in the same defined “year,” only 1 month ($15,000) of additional NSF-chargeable salary remains across every other NSF award that PI holds for the rest of that year — unless the excess is disclosed, justified, and specifically approved by NSF (see below). Because the limit is a fraction of the individual’s own salary rather than a fixed government number, two PIs at the same institution with different salaries will have different dollar amounts under the identical “two months” policy.
Who counts as “senior/key personnel”
The rule only constrains senior/key personnel compensation, a defined category in PAPPG Exhibit II-3: individuals designated by the proposing/recipient organization and approved by NSF who contribute in a substantive, meaningful way to the scientific development or execution of the project. NSF recognizes two categories:
- (Co-)Principal Investigator — up to one PI and up to four co-PIs per proposal; NSF does not infer a difference in scientific stature between a PI and a co-PI.
- Faculty Associate (faculty member or equivalent) contributing substantively to the project.
Postdoctoral associates, graduate students, and other project staff are budgeted separately and are not subject to the two-month senior/key personnel policy in the same way — their salary requests are governed by the organization’s regular salary practices and NSF’s general allowability rules instead.
Exceeding the two-month limit
The two-month figure is a general policy, not an absolute prohibition. If a project genuinely requires more than two months of a senior/key person’s salary in a year, NSF’s PAPPG sets out exactly what has to happen:
- The anticipated excess must be disclosed in the proposal budget at the time of submission — it cannot be added quietly after award.
- It must be justified in the budget justification, explaining why the project needs more than two months of that person’s committed effort.
- It must be specifically approved by NSF, reflected in the award notice budget itself.
Silently requesting or charging more than two months without disclosure and NSF approval is a compliance problem, not a routine budgeting choice.
Rebudgeting after the award is made
Once an award is active, NSF’s normal rebudgeting authority (PAPPG Chapters VII and X) gives the recipient institution some internal flexibility: it can approve an increase or decrease in the person-months a senior/key person devotes to the project after the award is made, even if that pushes salary support for that person over the two-month policy figure for the year. No prior NSF approval is required for this internal rebudgeting — unless the change in effort is significant enough that it also changes the project’s objectives or scope, in which case NSF prior approval is required for that separate reason, not because of the salary threshold itself.
How this differs structurally from the NIH salary cap
These two rules solve a similar underlying concern — keeping how much federal grant money pays toward a single person’s salary within bounds — through structurally different mechanisms. For the current NIH figure and how the NIH cap works, see NIH Salary Cap 2026: Current Figure, History, and How to Calculate It; the number itself is deliberately not repeated here to avoid two pages competing for the same claim.
| NSF two-month rule | NIH salary cap | |
|---|---|---|
| What’s limited | Number of months of a person’s own salary chargeable to NSF awards per year | The maximum salary rate any NIH award will reimburse, regardless of actual salary |
| Basis of the limit | The individual’s own regular institutional salary | A fixed federal dollar figure tied to Executive Level II of the federal pay scale, set by OPM and republished annually by NIH |
| Who it applies to | Senior/key personnel ((co-)PIs and Faculty Associates) as defined in PAPPG Exhibit II-3 | Anyone paid from an NIH grant, cooperative agreement, or R&D contract whose institutional base salary exceeds the capped rate |
| Can it flex? | Yes — excess months allowed with disclosure, justification, and NSF approval; internal rebudgeting allowed post-award without prior NSF approval unless scope changes | No — the rate ceiling is fixed; the institution must fund any salary above the cap from non-federal sources |
| Governing source | NSF PAPPG (NSF 24-1), Ch. II.D.2.f.i.a | Annual NIH Guide Notice (e.g. NOT-OD series), set by Congressional appropriations language each fiscal year |
Frequently asked questions
Is the NSF two-month rule the same as a salary cap?
No. A cap sets a maximum dollar rate regardless of what someone actually earns. NSF’s rule sets a maximum number of months of a person’s own salary that NSF funding can pay for in a year — the dollar amount that represents varies by individual.
What does “two months salary” mean on an NSF budget?
It means the proposal budget requests, at most, an amount equal to 2/12 of the senior/key person’s annual institutional base salary (or the academic-year equivalent, per the organization’s own definition of “year”) to be paid from NSF award funds for that person’s effort on the project(s), combined across all NSF awards that person holds.
What is the NSF senior personnel salary limit exactly?
It is the same two-month policy described above, applied specifically to individuals classified as senior/key personnel under PAPPG Exhibit II-3 — (co-)Principal Investigators and Faculty Associates who contribute substantively to the project’s scientific development or execution.
Does the two-month limit apply per grant or per person?
Per person, per year, across every NSF-funded grant that person holds — not two months allowed on each individual award separately.
Can a PI request more than two months of salary from NSF?
Yes, but only if the excess is disclosed in the proposal budget, justified in the budget justification, and specifically approved by NSF in the award notice budget. It cannot be added after the fact without that approval.
Does this rule apply to postdocs and graduate students?
No. The two-month policy specifically governs senior/key personnel salary requests. Postdoctoral associates, graduate students, and other project staff are budgeted under NSF’s general salary and wages rules and the organization’s regular compensation practices.
This page reflects NSF PAPPG NSF 24-1 (effective for proposals submitted or due on or after May 20, 2024), the current PAPPG version as of the last-verified date above. If NSF issues a later PAPPG version, re-check Chapter II.D.2.f.i.a before relying on this page for a live proposal.
