SpendQueryBeta

FAR and DFARS › FAR Part 49: Termination of Contracts › Subpart 49.6

FAR 49.604 Release of excess funds under terminated contracts.

The codified text (eCFR, as of 2026-10-02). Under the Revolutionary FAR Overhaul ↗, agencies follow class deviations with new text for many parts while the formal rules go through the Federal Register: check the solicitation and your contract's clauses, which rule.

In plain English

This section gives the format a termination contracting officer uses to recommend releasing excess funds under a terminated contract. It matters because it sets out the specific letter structure and information needed when funds are no longer required for settlement. It does not apply if the contracting office keeps responsibility for settling the termination.

Applies to: Termination contracting officers recommending release of excess funds under terminated contracts

What it requires

  • Use the specified format to recommend release of excess funds
  • Cite the termination notice and effective date
  • Cite prior letters releasing excess funds, if any
  • State whether the contract was completely or partially terminated

Key terms: excess funds · terminated contract · gross settlement cost · termination contracting officer · contracting office

Written by AI from this section's text. A guide, not legal advice: the text below rules.

The text

The following format shall be used to recommend the release of excess funds under terminated contracts, except if the contracting office retains responsibility for settlement of the termination:

FROM: Termination Contracting Officer ______ [address]

TO: Contracting office ________ [address]

SUBJ: Terminated Contract No. ____ with ____ [Contractor]

Refs:

(a) [Cite termination notice and effective date.]

(b) [Cite prior letters releasing excess funds, if any.]

1. Referenced termination notice, ______ [insert “completely” or “partially”] terminated contract ______.

2. Based on the best information available, it is estimated that the gross settlement cost will be $____________. The amount available for release as excess to the contract is $____________. Any payments previously made to the Contractor for terminated items have been considered in arriving at the above amounts.

[If prior letters recommending release of excess funds are cited, use the following as paragraph 2:

“The estimated settlement costs previously reported by reference (b) in the amount of $____________ are revised. On the best evidence now available, it is estimated that the settlement costs will be $____________. The additional amount available for release is $____________”.]

3. The related appropriations and amounts involved are:

Copies to:

Paying Office

Accounting and Finance Office

Other

Sections that refer to it

← 49.603-9 Settlement of reservations. · 49.605 Request to settle subcontractor settlement proposals. →

Rule changes for FAR Part 49

Source: eCFR, 48 CFR chapters 1 and 2 (GPO GovInfo bulk data) ↗. Plain words for the terms: glossary.

FAR 49.604 Release of excess funds under terminated contracts · SpendQuery