FAR 32.904: Federal Construction Prompt Payment Due Dates Explained
Understanding when the federal government must release contract funds is essential for trade contractors, framing and drywall estimators, and general contractors managing cash flow. Federal Acquisition Regulation (FAR) 32.904 establishes precise timelines for progress payments, retainage releases, and final contract disbursements.
When Is a Federal Construction Progress Payment Due?
Under Acquisition.GOV FAR 32.904(d)(1)(i), the standard due date for making progress payments on federal construction contracts is 14 days after the designated billing office receives a proper payment request. These progress payments are based on contracting officer approval of the estimated amount and value of work or services performed, including payments for reaching project milestones.
The contracting officer is prohibited from approving progress payment requests unless the contractor provides the required certification and substantiation of amounts specified in FAR 52.232-5 Bidding Checklist: Payments and Retainage Rules.
Can the Government Extend the 14-Day Progress Payment Window?
Yes, but the contracting officer must adhere to strict administrative requirements before extending the timeframe. Under FAR 32.904(d)(1)(i)(B), the contracting officer may specify a period longer than 14 days in the solicitation and resulting contract only if required to provide the government a reasonable opportunity to:
- Adequately inspect the construction work performed.
- Determine the adequacy of the contractor's performance under the contract.
Whenever a longer period is specified, the contracting officer must document the formal justification for extending the due date beyond 14 days in the contract file.
When Must the Contracting Officer Release Retainage?
On jobs where money is withheld from progress billings, FAR 32.904(d)(1)(ii) sets clear parameters for releasing those funds. The payment due date for amounts retained under FAR 52.232-5 is either the date specified directly in the contract or, if no date is specified, 30 days after the contracting officer approves the retainage for release to the contractor.
The regulation requires the contracting officer to base any release of retained amounts on a determination that satisfactory progress has been made on the project. For strategies on managing retainage risk across your trade bids, review our explainer on Retainage Explained: How It Works and How Subcontractors Protect Cash Flow.
What Is the Due Date for Final Payments and Partial Deliveries?
For final payments based on completion and acceptance of all work (including any remaining retained amounts), as well as payments for accepted partial deliveries such as a separately priced building or work division, FAR 32.904(d)(1)(iii) sets the due date as the later of two events:
- The 30th day after the designated billing office receives a proper invoice from the contractor.
- The 30th day after government acceptance of the work or services completed by the contractor.
When the payment amount on a final invoice is subject to contract settlement actions, such as the execution of a release of contractor claims, acceptance is deemed to occur on the effective date of that contract settlement.
For the sole purpose of computing late payment interest penalties on these payments, government acceptance is deemed to occur constructively on the 7th day after work or service completion, unless there is an ongoing disagreement regarding quantity, quality, contractor compliance, or the requested amount.
What Happens If the Billing Office Fails to Date-Stamp an Invoice?
When an agency's designated billing office neglects to annotate a payment submission with the actual calendar date of receipt, FAR 32.904 provides automatic fallback dates to protect the contractor's timeline:
- Progress payment requests: The payment due date is the 14th day after the date appearing on the contractor's payment request.
- Final invoices and partial deliveries: The payment due date is the 30th day after the date appearing on the contractor's invoice.
These automatic calendar rules apply provided the billing office received a proper invoice or payment request and there is no active disagreement concerning quality, quantity, or contractor compliance with contract requirements.
How Does the Government Address Subcontractor Certifications and Unearned Amounts?
Payment rules under Acquisition.GOV FAR 32.904 also intersect with subcontractor protections. Construction contracts contain special provisions and certifications regarding payments to subcontractors. The Office of Management and Budget has determined that these certifications must not be construed as final acceptance of a subcontractor's performance. Payment certificates remain acceptable even if the contractor deletes paragraph (c)(4) of FAR 52.232-5 from the certificate.
Furthermore, under FAR 52.232-5(d) and FAR 52.232-27(e)(6), contractors must pay interest on unearned amounts under specific circumstances. The government recovers this interest directly from subsequent payments owed to the contractor. Contracting officers compute the amount, issue a final decision, and instruct the payment office to deduct the funds, which revert directly to the United States Treasury.
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Published October 31, 2026. No affiliate links on this page. Facts come from the sources linked above; check them for updates.