Retainage

A portion of earned payment withheld under the construction contract until specified release conditions are met. The applicable percentage and release process come from the contract and governing requirements.

Why it matters

Retainage is not the same as unfinished work or contingency. Releasing it changes the amount available to address completion and closeout issues. Reviewers should identify reductions and partial releases rather than assume one percentage applies throughout the job.

In practice

A project example

A subcontractor may have finished its work, but its retainage release may still depend on required documentation or other contract conditions.

General educational guidance from KOW Building Consultants. Examples are illustrative, not project records. The applicable contract, standard, program, and jurisdiction control the requirements for a specific assignment.