The electronic structure and absorption spectrum of hydrogenated silicon carbide nanocrystals (SiCNC) have been determined by first principles calculations. We show that the reconstructed surface can significantly change not just the onset of absorption, but the shape of the spectrum at higher energies. We found that the absorption treshold of the reconstructed SiCNs cannot be accurately predicted from traditional density functional theory calculations. PACS numbers: 78.67.Bf, 71.15.Qe Semiconductor nanocrystals (NC) are objects of intense interest in fields ranging from biology [1] to third generation solar cells [2,3]. NCs are small pieces of crystal with a surface to volume ratio that is much larger than is typical for bulk crystals. Therefore, understanding the surface states of NCs could be critical in the interpretation of the measurements, or in applications [4]. Pure covalent semiconductor NCs have dangling bonds at the surface that can easily react with the molecules present in the environment. The simplest example is when the dangling bonds are saturated by hydrogen atoms. It is well-known from surface studies of bulk covalent semiconductors that saturation can happen either by conserving the bulk-like structure at the surface or by reconstruction at the surface with formation of long bonds. In what follows, we will refer to a non-reconstructed surface as an "ideal" surface. While the structure of surface reconstruction and its effect on the electrical/optical properties can be monitored by experiments and first principles simulations for the bulk crystals, our understanding of semiconductor NCs remains undeveloped. Traditional ab initio density functional theory (DFT) calculations have been successfully applied to explore the geometry and electronic structure of small covalent semiconductor NCs, and rarely, up to experimental sizes [5]. However, accurate calculation of the absorption spectrum of NCs requires methods beyond DFT that are usually computationally prohibitive. While DFT is a ground state theory, it is usually assumed that one can use the DFT electronic gap [6] with some "rigid shift" to calculate the absorption treshold of the NCs. For example, a difference of ≈1.5 eV was deduced by comparing the DFT and Quantum Monte Carlo results on ideal very small hydrogenated silicon nanocrystals [7]. However, it is not clear whether this type of correction may hold for the reconstructed surface. In addition, the surface states may modify not just the absorption treshold of the ideal nanocrystals, but the other part of the spectrum as well.In this Letter we investigate ideal and recon-structed hydrogenated cubic silicon carbide nanocrystals (SiCNC). The choice of this material was made for several reasons: i) as a binary compound material one can study the effect of two types of termination ii) SiCNC is one of the most promising candidates for bioinert biomarkers [8,9,10] and environmental friendly nanooptics [11,12,13] iii) the experimental absorption spectrum is available for small-medium sized co...