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48 CFR · Federal Acquisition Regulation and Defense supplement

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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.

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74 sections with “profit or fee”: the first 40

  • FAR 52.203-10 Price or Fee Adjustment for Illegal or Improper Activity.
    …rice type contract and the total cost and fee under a cost-type contract by the amount of profit or fee determined as set forth in paragraph (b) of this clause if the head of the contracting activity or designee determines that there was a …
  • FAR 15.404-4 Profit.
    (a) General. This subsection prescribes policies for establishing the profit or fee portion of the Government prenegotiation objective in price negotiations based on cost analysis. (1) Profit or fee prenegotiation objectives do not necessa…
  • DFARS 215.404-4 Profit.
    … (1) Contracting officers shall use a structured approach for developing a prenegotiation profit or fee objective on any negotiated contract action when certified cost or pricing data is obtained, except for cost-plus-award-fee contracts (s…
  • FAR 15.407-1 Defective certified cost or pricing data.
    …Current Cost or Pricing Data, the Government is entitled to a price adjustment, including profit or fee, of any significant amount by which the price was increased because of the defective data. This entitlement is ensured by including in t…
  • DFARS 215.404-72 Modified weighted guidelines method for nonprofit organizations other than FFRDCs.
    (a) Definition. As used in this subpart, a nonprofit organization is a business entity— (1) That operates exclusively for charitable, scientific, or educational purposes; (2) Whose earnings do not benefit any private shareholder or indivi…
  • FAR 49.502 Termination for convenience of the Government.
    …ppropriate, (ii) in contracts for research and development work with an educational or nonprofit institution on a no-profit basis, (iii) in contracts for architect-engineer services, or (iv) if one of the clauses prescribed or cited at 49.5…
  • FAR 52.227-11 Patent Rights—Ownership by the Contractor.
    …vely determined that the variety has been reproduced with recognized characteristics. Nonprofit organization means a university or other institution of higher education or an organization of the type described in section 501(c)(3) of the I…
  • FAR 15.405 Price negotiation.
    …ecome preoccupied with any single element and should balance the contract type, cost, and profit or fee negotiated to achieve a total result—a price that is fair and reasonable to both the Government and the contractor. (c) The Government'…
  • FAR 16.402-1 Cost incentives.
    (a) Most incentive contracts include only cost incentives, which take the form of a profit or fee adjustment formula and are intended to motivate the contractor to effectively manage costs. No incentive contract may provide for other incent…
  • FAR 52.215-10 Price Reduction for Defective Certified Cost or Pricing Data.
    …tion for Defective Certified Cost or Pricing Data (AUG 2011) (a) If any price, including profit or fee, negotiated in connection with this contract, or any cost reimbursable under this contract, was increased by any significant amount beca…
  • FAR 52.215-11 Price Reduction for Defective Certified Cost or Pricing Data—Modifications.
    … modification if an exception under FAR 15.403-1(b) applies. (b) If any price, including profit or fee, negotiated in connection with any modification under this clause, or any cost reimbursable under this contract, was increased by any si…
  • FAR 52.232-7 Payments under Time-and-Materials and Labor-Hour Contracts.
    …hourly rates shall include wages, indirect costs, general and administrative expense, and profit. Fractional parts of an hour shall be payable on a prorated basis. (5) Vouchers may be submitted not more than once every two weeks, to the Co…
  • DFARS 215.404-71-3 Contract type risk and working capital adjustment.
    …nder varying contract types. The working capital adjustment is an adjustment added to the profit objective for contract type risk. It only applies to fixed-price contracts that provide for progress payments. Though it uses a formula approac…
  • DFARS 215.404-75 Fee requirements for FFRDCs.
    For nonprofit organizations that are FFRDCs, the contracting officer— (a) Should consider whether any fee is appropriate. Considerations shall include the FFRDC's— (1) Proportion of retained earnings (as established under generally accept…
  • DFARS 252.227-7038 Patent Rights—Ownership by the Contractor (Large Business).
    …vely determined that the variety has been reproduced with recognized characteristics. Nonprofit organization means— (1) A university or other institution of higher education; (2) An organization of the type described in the Internal Reve…
  • FAR 3.802 Statutory prohibition and requirement.
    …actions. (1) For purposes of this subpart the term “appropriated funds” does not include profit or fee from a covered Federal action. (2) To the extent a person can demonstrate that the person has sufficient monies, other than Federal app…
  • FAR 16.101 General.
    …sumed by the contractor for the costs of performance and (2) the amount and nature of the profit incentive offered to the contractor for achieving or exceeding specified standards or goals. (b) The contract types are grouped into two broad…
  • FAR 16.402-2 Performance incentives.
    …c elements of the contractor's performance. These incentives should be designed to relate profit or fee to results achieved by the contractor, compared with specified targets. (b) To the maximum extent practicable, positive and negative pe…
  • FAR 30.604 Processing changes to disclosed or established cost accounting practices.
    …ncluding any impact the change may have on contract and subcontract incentives, fees, and profits, for each of the following groups: (A) Fixed-price contracts and subcontracts. (B) Flexibly-priced contracts and subcontracts. (ii) For uni…
  • FAR 50.102-3 Limitations on exercise of authority.
    …-cost system of contracting; (2) Making any contract that violates existing law limiting profit or fees; (3) Providing for other than full and open competition for award of contracts for supplies or services; or (4) Waiving any bid bond,…
  • FAR 2.101 Definitions.
    … unique entity identifier. The suffix is assigned at the discretion of the commercial, nonprofit, or Government entity to establish additional System for Award Management records for identifying alternative EFT accounts (see subpart 32.11) …
  • FAR 27.302 Policy.
    …limitations under 35 U.S.C. 202(a)(iv) for agreements with small business concerns and nonprofit organizations are limited to inventions occurring under the above two programs; or (v) Pursuant to statute or in accordance with agency regula…
  • FAR 35.017-1 Sponsoring agreements.
    …s form which work can be accepted (other Federal agencies, State or local governments, nonprofit or profit organizations, etc.). (d) The sponsoring agreement or sponsoring agencies' policies and procedures may also contain, as appropriate,…
  • FAR 48.102 Policies.
    … on the basis of competition. (e) Value engineering incentive payments do not constitute profit or fee within the limitations imposed by 10 U.S.C. 3322(b) and 41 U.S.C. 3905 (see 15.404-4(c)(4)(i). (f) Generally, profit or fee on the inst…
  • FAR 52.203-12 Limitation on Payments to Influence Certain Federal Transactions.
    …, society, State, and local government, regardless of whether such entity is operated for profit, or not for profit. This term excludes an Indian tribe, tribal organization, or any other Indian organization eligible to receive Federal contr…
  • FAR 52.212-4 Contract Terms and Conditions—Commercial Products and Commercial Services.
    …cement or correction shall be reduced to exclude that portion of the rate attributable to profit. Unless otherwise specified below, the portion of the “hourly rate” attributable to profit shall be 10 percent. The Contractor shall not tender…
  • FAR 52.215-22 Limitations on Pass-Through Charges—Identification of Subcontract Effort.
    …feror shall identify in its proposal— (i) The amount of the offeror's indirect costs and profit/fee applicable to the work to be performed by the subcontractor(s); and (ii) A description of the added value provided by the offeror as relat…
  • FAR 52.216-11 Cost Contract—No Fee.
    …000 in lieu of $100,000 as the maximum reserve in paragraph (b) if the Contractor is a nonprofit organization. Cost Contract—No Fee (APR 1984) (a) The Government shall not pay the Contractor a fee for performing this contract. (b) After …
  • FAR 52.217-2 Cancellation Under Multiyear Contracts.
    …tract period but, because of the cancellation, are not so amortized, and (2) a reasonable profit or fee on the costs. (e) The cancellation charge shall be computed and the claim made for it as if the claim were being made under the Termina…
  • FAR 52.230-6 Administration of Cost Accounting Standards.
    …ncluding any impact the change may have on contract and subcontract incentives, fees, and profits, for each of the following groups: (A) Fixed-price contracts and subcontracts. (B) Flexibly-priced contracts and subcontracts. (ii) For uni…
  • FAR 52.232-12 Advance Payments.
    …it the interest to the Government. Interest need not be charged on advance payments to nonprofit educational or research subcontractors for experimental, developmental, or research work. (3) If interest is required under the contract, the …
  • DFARS 215.403-1 Prohibition on obtaining certified cost or pricing data (10 U.S.C. chapter 271 and 41 U.S.C. chapter 35).
    …and 225.870-4(c)). (D) DoD has waived certified cost or pricing data requirements for nonprofit organizations (including education institutions) on cost-reimbursement-no-fee contracts. The contracting officer shall require— (1) Submission…
  • DFARS 252.246-7001 Warranty of data.
    …liability under paragraph (d)(3) of this clause shall not exceed 75 percent of the target profit. (ii) If the breach of the warranty is with respect to the data supplied by an equipment subcontractor, the limit of the Contractor's liabilit…
  • FAR 3.104-7 Violations or possible violations.
    …) If a contract has been awarded— (i) Effect appropriate contractual remedies, including profit recapture under the clause at 52.203-10, Price or Fee Adjustment for Illegal or Improper Activity, or, if the contract has been rescinded under…
  • FAR 15.404-1 Proposal analysis techniques.
    …nd evaluating a proposed price without evaluating its separate cost elements and proposed profit. Unless an exception from the requirement to obtain certified cost or pricing data applies under 15.403-1(b)(1) or (b)(2), at a minimum, the co…
  • FAR 15.406-3 Documenting the negotiation.
    …ng the award and review process for the instant contract action). (10) The basis for the profit or fee prenegotiation objective and the profit or fee negotiated. (11) Documentation of fair and reasonable pricing. (b) Whenever field prici…
  • FAR 16.307 Contract clauses.
    …hall use the clause at 52.216-7 with its Alternate III. (5) If the contract is with a nonprofit organization other than an educational institution, a State or local government, or a nonprofit organization exempted under the OMB Uniform Gui…
  • FAR 16.401 General.
    …ain instances, with improved delivery or technical performance, by relating the amount of profit or fee payable under the contract to the contractor's performance. Incentive contracts are designed to obtain specific acquisition objectives b…
  • FAR 16.404 Fixed-price contracts with award fees.
    …t be measured objectively. Such contracts shall establish a fixed price (including normal profit) for the effort. This price will be paid for satisfactory contract performance. Award fee earned (if any) will be paid in addition to that fixe…
  • FAR 32.409-1 Recommendation for approval.
    …ies or performance, and status of any deliveries or performance; (5) The contract fee or profit contemplated; and (6) A copy of the contract, if available. (b) The contractor's request and supporting information. (c) A report on the con…

FAR (chapter 1)

DFARS (chapter 2, Defense)

Source: eCFR, 48 CFR chapters 1 and 2 (GPO GovInfo bulk data) ↗. Rule changes in progress: FAR, DFARS. Terms: glossary.