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Whose responsibility is it to make the subrecipient vs contractor determination?

It is the responsibility of the pass-through entity to make the correct determination between subrecipient or contractor determination.  This determination is to be made on a case-by-case basis depending on the unique relationship of each individual situation.  Entities should focus on the substance of the relationship, not the form of the agreement, when making this determination.  Entities must use judgement in determining whether each agreement is a subaward or a procurement contract (§ 200.330(c) above).  

Why is it important to properly distinguish between a subrecipient and a contractor?

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