SpendQueryBeta

48 CFR · Federal Acquisition Regulation and Defense supplement

FAR and DFARS navigator

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.

Ask the FAR

Try: · · ·

Clear

23 sections with “target profit”

  • FAR 16.403-1 Fixed-price incentive (firm target) contracts.
    (a) Description. A fixed-price incentive (firm target) contract specifies a target cost, a target profit, a price ceiling (but not a profit ceiling or floor), and a profit adjustment formula. These elements are all negotiated at the outset.…
  • FAR 16.403-2 Fixed-price incentive (successive targets) contracts.
    (a) Description. (1) A fixed-price incentive (successive targets) contract specifies the following elements, all of which are negotiated at the outset: (i) An initial target cost. (ii) An initial target profit. (iii) An initial profit ad…
  • FAR 52.216-16 Incentive Price Revision—Firm Target.
    As prescribed in 16.406(a), insert the following clause: Incentive Price Revision—Firm Target (JAN 2022) (a) General. The supplies or services identified in the Schedule as Items ___ [Contracting Officer insert Schedule line item numbers]…
  • FAR 52.216-17 Incentive Price Revision—Successive Targets.
    …rescribed in 16.406(b), insert the following clause: Incentive Price Revision—Successive Targets (JAN 2022) (a) General. The supplies or services identified in the Schedule as Items ___ [Contracting Officer insert line item numbers] are s…
  • FAR 16.402-1 Cost incentives.
    …Except for award-fee contracts (see 16.404 and 16.401 (e)), incentive contracts include a target cost, a target profit or fee, and a profit or fee adjustment formula that (within the constraints of a price ceiling or minimum and maximum fee…
  • FAR 52.203-10 Price or Fee Adjustment for Illegal or Improper Activity.
    …ed in the contract at the time of award; (2) For cost-plus-incentive-fee conrtracts, the target fee specified in the contract at the time of award, notwithstanding any minimum fee or “fee floor” specified in the contract. (3) For cost-plu…
  • FAR 16.401 General.
    …to obtain specific acquisition objectives by— (1) Establishing reasonable and attainable targets that are clearly communicated to the contractor; and (2) Including appropriate incentive arrangements designed to (i) motivate contractor eff…
  • FAR 32.503-9 Liquidation rates—alternate method.
    …be increased or decreased in keeping with the successive changes to the contract price or target profit when— (i) The target profit is changed under a fixed-price incentive contract with successive targets; or (ii) A redetermined price in…
  • FAR 52.248-1 Value Engineering.
    …tant contract items affected. Any negative instant contract savings shall be added to the target cost or to the target price and ceiling price, and the amount shall be offset against concurrent and future contract savings. (4) If the Gover…
  • DFARS 252.246-7001 Warranty of data.
    …tional 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 l…
  • FAR 16.403 Fixed-price incentive contracts.
    …pplication of a formula based on the relationship of total final negotiated cost to total target cost. The final price is subject to a price ceiling, negotiated at the outset. The two forms of fixed-price incentive contracts, firm target an…
  • FAR 27.202-5 Solicitation provisions and contract clause.
    …der the contract. If a fixed-price incentive contract is contemplated, change “price” to “target cost and target profit” wherever it appears in the clause. The clause may be used in cost-reimbursement contracts where agency approval of roya…
  • FAR 52.226-1 Utilization of Indian Organizations and Indian-Owned Economic Enterprises.
    …tive Program to the following: (i) The estimated cost of a cost-type contract. (ii) The target cost of a cost-plus-incentive-fee prime contract. (iii) The target cost and ceiling price of a fixed-price incentive prime contract. (iv) The…
  • FAR 16.402-2 Performance incentives.
    …ed to relate profit or fee to results achieved by the contractor, compared with specified targets. (b) To the maximum extent practicable, positive and negative performance incentives shall be considered in connection with service contracts…
  • FAR 31.205-6 Compensation for personal services.
    …rdedafterJune24.pdf. (iii) Exceptions. An agency head may establish one or more narrowly targeted exceptions for scientists, engineers, or other specialists upon a determination that such exceptions are needed to ensure that the executive …
  • FAR 48.104-2 Sharing acquisition savings.
    …contracts, the contracting officer shall add any negative instant contract savings to the target cost or to the target price and ceiling price and then offset these negative instant contract savings and any Government costs against concurre…
  • FAR 52.230-6 Administration of Cost Accounting Standards.
    … (i) Estimated increased cost accumulations are the basis for increasing contract prices, target prices and cost ceilings; and (ii) Estimated decreased cost accumulations are the basis for decreasing contract prices, target prices and cost…
  • DFARS 215.404-71-4 Facilities capital employed.
    …es capital cost of money, with normal, booked costs, to establish a cost objective or the target cost when structuring an incentive type contract. Do not adjust target costs established at the outset even though actual cost of money rates b…
  • DFARS 252.226-7001 Utilization of Indian Organizations, Indian-Owned Economic Enterprises, and Native Hawaiian Small Business Concerns.
    …ause. (2) The incentive amount that may be requested is 5 percent of the estimated cost, target cost, or fixed price included in the subcontract at the time of award to the Indian organization, Indian-owned economic enterprise, or Native H…
  • FAR 16.204 Fixed-price incentive contracts.
    …ract price by a formula based on the relationship of final negotiated total cost to total target cost. Fixed-price incentive contracts are covered in subpart 16.4, Incentive Contracts. See 16.403 for more complete descriptions, application,…
  • DFARS 215.404-71-2 Performance risk.
    …edule; and (vii) Any other factors that affect the contractor's ability to meet the cost targets (e.g., foreign currency exchange rates and inflation rates). (2) Above normal conditions. (i) The contracting officer may assign a higher tha…
  • DFARS 244.305-70 Policy.
    …proposal; (ii) Considering another type of contract, e.g., a fixed-price incentive (firm target) contract instead of firm-fixed-price; (iii) Using additional cost analysis techniques to determine the reasonableness of the cost elements af…
  • DFARS 252.232-7007 Limitation of Government's obligation.
    …otted, an equitable adjustment will be made in the price or prices (including appropriate target, billing, and ceiling prices where applicable) of the item(s), or in the time of delivery, or both. Failure to agree to any such equitable adju…

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.