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Retainage · Missouri

Missouri retainage law: 5% public, 10% private, 30-day release (2026)

By Sami Chicha, EditorUpdated Checked against primary sources · not yet reviewed by a licensed professionalFact-checked
Quick answer

On Missouri public works, § 8.960 caps retainage at 5% of the contract or subcontract (10% where no bond is required) and the owner pays at least 98% within 30 days after acceptance; late payment carries 1.5% per month. On private projects, § 436.303 caps retainage at 10% of each payment, and § 436.324 requires release within 30 days of substantial completion, less 150% of the cost of remaining items.

Private work

Missouri · Private workVerified 2026-09-22
Retainage cap
10%
Mo. Rev. Stat. § 436.303: a private construction contract may provide for retainage of a portion of any payment due from the owner to the contractor, not to exceed ten percent of the amount of the payment due; the contract may let the owner retain additional sums if the contractor's performance is not in accordance with it. Retainage is held by the owner in trust for the contractor and its subcontractors, sub-subcontractors and suppliers at every tier who are not in default. A contractor may not withhold from a subcontractor more retainage than the owner withholds from the contractor for that subcontractor's work, unless the subcontractor's performance is not in accordance with the subcontract (§ 436.315). Sections 436.300 to 436.336 apply to contracts entered into after August 28, 2002, on all private construction projects except single-family residential construction and other residential construction of four or fewer units (§ 436.336); a contract formed after that date is unenforceable to the extent it is inconsistent with them (§ 436.333).
Deadline
30 days
Within thirty days of the project reaching substantial completion, the owner releases all retainage or substitute security to the contractor, less 150 percent of the cost to complete any remaining items; the contractor then releases each subcontractor's share within seven days of receiving it (§ 436.324). Substantial completion is the earlier of the architect's or engineer's certificate of substantial completion or the owner's acceptance of the performance of the full contract (§ 436.327).
Statute
Mo. Rev. Stat. §§ 436.303 (cap), 436.324 (release), 436.333 (interest and fees), 436.336 (scope).
What the statute says
A contract or agreement may include a provision for the retainage of a portion of any payment due from the owner to the contractor, not to exceed ten percent of the amount of such payment due pursuant to the contract or agreement, to ensure the proper performance of the contract or agreement
Mo. Rev. Stat. §§ 436.303 (cap), 436.324 (release), 436.333 (interest and fees), 436.336 (scope). · Official text · retrieved 2026-10-17

Public work

Missouri · Public workVerified 2026-09-22
Retainage cap
5%
'Retainage withheld on any construction contract or subcontract for public works projects shall not exceed five percent of the value of the contract or subcontract.' Where no bond is required under § 107.170 because the contract is not estimated to exceed $50,000, the public owner may withhold up to 10%. A public owner may reduce or eliminate retainage on any payment if the work is proceeding satisfactorily, and where a subcontractor's work is complete the contractor may request an adjustment so the sub can be paid in full before substantial completion.
Deadline
30 days
The public owner must pay at least 98% of the retainage, less authorized offsets, and payment to the subcontractor or supplier follows substantial completion of the contract work and acceptance by the public owner's authorized contract representative; that payment is due within 30 days after acceptance once the invoice and required documentation are in complete and acceptable form. If the owner decides the work is not substantially complete and accepted, it must give a written explanation within 14 calendar days; if it does not, it must pay at least 98% of the retainage within 30 calendar days. Where minor items remain, 150% of the value of each item may be withheld until completed. Final payment of all money owed, including retainage, is due within 30 days of the due date.
Statute
Mo. Rev. Stat. § 8.960 (formerly § 34.057).
What the statute says
Retainage withheld on any construction contract or subcontract for public works projects shall not exceed five percent of the value of the contract or subcontract. If the contractor is not required to obtain a bond under section 107.170… the public owner may withhold retainage on the public works project in an amount not to exceed ten percent of the value of the contract or subcontract.
Mo. Rev. Stat. § 8.960 (formerly § 34.057). · Official text · retrieved 2026-09-22

Who this applies to

Missouri has two retainage statutes, one for each side. Section 8.960 is limited by its terms to public works contracts awarded by the state, a political subdivision or a district [1], and it reaches both the prime contract and the subcontracts beneath it [1]. This page does not cover highway, road and bridge projects administered by the state highways and transportation commission; for those, read § 8.960 [1] together with the contract.

Private jobs fall under §§ 436.300 to 436.336, which apply to contracts entered into after August 28, 2002 on all private construction projects except single-family residential construction and other residential construction of four or fewer units [4]. A contract formed after that date is unenforceable to the extent it conflicts with them [4]. Separately, § 431.180 requires everyone who entered into a contract for private design or construction work after August 28, 1995 to make all scheduled payments under its terms [2].

What the rule says

On a public works project, retainage on a construction contract or subcontract may not exceed 5% of the value of that contract or subcontract [1]. A higher limit applies where the contractor is not required to obtain a bond under § 107.170 because the contract is not estimated to exceed $50,000: there the public owner may withhold up to 10% [1]. The owner may also reduce or eliminate retainage on any payment while the work is proceeding satisfactorily [1]. When a subcontractor's work is complete, the contractor may request an adjustment so that subcontractor can be paid in full before substantial completion [1].

On a private project, a contract may provide for retainage of no more than 10% of any payment due from the owner to the contractor, and the owner holds it in trust for the contractor and its subcontractors and suppliers at every tier who are not in default [4]. If the contractor's performance does not follow the contract, the contract may let the owner retain more [4]. A contractor may not withhold from a subcontractor more retainage than the owner withholds from the contractor for that subcontractor's work, unless the subcontractor's own performance falls short [4].

How to comply

On public work, the release runs in this order.

  1. Substantial completion and acceptance. Payment follows substantial completion of the contract work and acceptance by the public owner's authorized contract representative [1].
  2. A written answer within 14 calendar days. If the owner decides the work is not substantially complete and accepted, it must explain why in writing within 14 calendar days [1]. If it does not, it must pay at least 98% of the retainage within 30 calendar days [1].
  3. Payment within 30 days. The owner pays the contractor at least 98% of the retainage, less offsets or deductions authorized in the contract or by law, within 30 days after acceptance, once the invoice and required documentation are in complete and acceptable form [1].
  4. Punch-list items. Where minor items remain, the owner may withhold 150% of the value of each item until it is completed [1].
  5. Passing payment down. A contractor that, without reasonable cause, fails to pay its subcontractors and suppliers within 15 days of being paid owes them 1.5% per month, and that rule applies at every tier [1].

If the contracting agency misses the 30-day progress-payment window, it owes 1.5% per month from the end of that period until paid [1]. Money withheld in good faith for reasonable cause earns no interest [1]. If a court finds a withholding was not in good faith, it may impose 1.5% per month from the invoice date and award attorney fees [1].

On private work, the release runs this way.

  1. Substantial completion. The project reaches substantial completion at the earlier of the architect's or engineer's certificate of substantial completion or the owner's acceptance of the full contract [4].
  2. Release within 30 days. Within 30 days of substantial completion, the owner releases all retainage or substitute security to the contractor, less 150% of the cost to complete any remaining items [4].
  3. Passing it down. The contractor releases each subcontractor's share within 7 days of receiving it [4].
  4. If it is withheld wrongly. A court may award interest of up to 1.5% per month from the date of the wrongful withholding, on top of other damages, and reasonable attorney's fees to the prevailing party [4].

A party not paid on the contract's schedule also has the general remedy in § 431.180: interest of up to 1.5% per month from the date payment was due and attorney fees [2].

What changed recently

Missouri's public retainage section was transferred in 2022 from § 34.057 to § 8.960 [3], and its history lists L. 2022 S.B. 758, effective 28 August 2022 [1]. The private retainage sections, §§ 436.300 to 436.336, come from H.B. 1403 of 2002, effective 28 August 2002, with no later amendment [4]. The general private payment statute, § 431.180, comes from S.B. 93 of 1995 and was amended by H.B. 343 of 1999, effective 28 August 1999 [2].

Related

Run the numbers for Missouri

How retainage is held on each payment and when it comes back: Retainage in construction. Bill it on the pay application template, which carries retainage on work and on stored materials.

Retainage laws: other states

Sources

  1. Mo. Rev. Stat. § 8.960, Prompt payments required, progress payments, retainage, late payment charges, withholding of payments (Missouri Revisor of Statutes) (retrieved 2026-09-22)
  2. Mo. Rev. Stat. § 431.180, Contract for private design or construction work, scheduled payments (Missouri Revisor of Statutes) (retrieved 2026-09-22)
  3. Mo. Rev. Stat. § 34.057, Transferred 2022; now § 8.960 (Missouri Revisor of Statutes) (retrieved 2026-09-22)
  4. Mo. Rev. Stat. §§ 436.300 to 436.336, private construction retainage (live, revisor.mo.gov) (retrieved 2026-10-17)

Changelog

  1. : Page updated.
  2. : 1 more jurisdiction verified and published, 47 of 51 in all.
  3. : California private work corrected: Civ. Code § 8811 (SB 61) caps retention at 5% for contracts entered into on or after January 1, 2026; the row had said no cap.
  4. : Missouri private work corrected: Mo. Rev. Stat. §§ 436.300 to 436.336 cap private retainage at 10% and require release within 30 days of substantial completion; the row had said no private retainage rule.
  5. : Tennessee corrected: Tenn. Code Ann. § 66-34-203 caps owner-to-prime retainage at 5% of the contract, on public and private work; escrow applies to prime contracts of $500,000 or more, and the $300-a-day damages do not apply to public owners.
  6. : Idaho private work added: Idaho Code § 29-115 caps private retention at 5% and requires release within 35 days of final completion; the row had left private work out.
  7. : Rhode Island corrected: the 5% cap in R.I. Gen. Laws § 37-12-10.1 also covers private lienable work of $250,000 or more, and a retainage application may be submitted only 60 days after substantial completion unless the contract allows earlier.
  8. : Oklahoma public work corrected: since November 1, 2022, 61 O.S. §§ 113.1 and 226 reduce retainage to 2.5% of the amount earned to date after 50% completion with satisfactory progress, with no bond condition.
  9. : Montana public work corrected: state and local public contracts are capped at 5% under Mont. Code Ann. § 18-2-316, and final payment on building contracts is due within 30 days of final acceptance (§ 18-2-306).
  10. : Delaware public work corrected: 29 Del. C. § 6516(f)(3) requires retainage to be paid within 60 days after completion or notice of completion, with interest available from the 61st day; the row had no release deadline.
  11. : District of Columbia corrected: D.C. Code § 2-203.01 requires a 10% retent on District construction contracts until completion and acceptance, and the Private Contractor and Subcontractor Prompt Payment Act counts retainage as an undisputed amount due on its schedule; both rows had said no statute.
  12. : Colorado private work updated: HB26-1311 lets a contractor or subcontractor tender a retainage bond of up to 5% in lieu of retainage on contracts from August 12, 2026, and the owner must accept a compliant bond.
  13. : Kentucky private work updated: 2025 Ky. Acts ch. 156 raised the KRS 371.160 escrow threshold to $2,000,000 and barred waiving it by contract.
  14. : 10 more jurisdictions verified and published, 46 of 51 in all.
  15. : Page published.
  16. : Dataset first published with 36 of 51 jurisdictions verified.