In piping design analysis, the secondary stresses (displacement controlled) may have different design limits than primary stresses (load-controlled stresses). The current design limits for secondary stresses are based on elastic stress analysis. But realistically, a flaw in the piping system can cause nonlinear behavior due to the plasticity at the crack plane as well as in the adjacent uncracked-piping material. Hence, the actual stresses in a cracked piping system, which are elastic-plastic, are different than the design stresses, which are elastically calculated. To assess margins in the secondary stresses calculated using elastic stress analysis in pipe flaw evaluation, two parameters are defined in this paper. The first one is the secondary stress weighting factor (SSWF) on total stress, which is defined as the ratio of actual elastic-plastic stresses in a system to the elastic design stress. An alternative approach to applying margins on secondary stresses is to use a reduction factor only on stresses above the yield stress called plastic reduction factor (PRF). In this paper, a methodology developed to determine these factors for circumferential surface-cracked TP304 stainless steel pipes subjected to bending loads at ambient temperature is described. Four-point-bend tests are conducted on pipes with varying circumferential surface-crack lengths and depths. The moments and rotations needed for the pipe failure for different crack sizes are determined and compared to elastically calculated moments and rotations to establish margins.