# Texas — Construction prompt payment act deadlines by US state — owner-to-contractor and contractor-to-subcontractor payment windows, retention release deadlines, and late-payment interest rates

For Texas, owner-to-gc payment deadline (days) is 35; gc-to-sub flow-down deadline (days) is 7; late-payment interest rate is 1.5% per month; project types covered is both; attorney fees recoverable is yes, recorded from its source on 2026-08-14.

- **State:** Texas _(verified: appears in the quote below)_
- **Owner-to-GC payment deadline (days):** 35 _(verified: appears in the quote below)_
- **GC-to-sub flow-down deadline (days):** 7 _(verified: appears in the quote below)_
- **Late-payment interest rate:** 1.5% per month _(verified: appears in the quote below)_
- **Project types covered:** both _(verified: appears in the quote below)_
- **Attorney fees recoverable:** yes
- **Statutory citation:** Property Code Chapter 28; Government Code Chapter §2251

## What the source says

> Projects Covered by the Texas Prompt Payment Act The State of Texas has prompt payment laws that regulate payment on both private and public construction projects within the state. Private Projects Payments on private construction projects in Texas are governed by <https://statutes.capitol.texas.gov/Docs/PR/htm/PR.28.htm> Property Code Chapter 28: Prompt Payment to Contractors and Subcontractors . These statutes regulate the time limits and interest penalties on all private construction projects within the state. Payment Deadlines for Private Projects On private projects in Texas, the property owner must make payment to the prime contractor within 35 days of invoice receipt. Once the prime contractor receives payment from the property owner, they must pay their subs and suppliers within 7 days . This same 7-day turnaround period applies to all payments down the next tier. Reasons for Withholding Payment <https://www.levelset.com/retainage/texas-retainage-faqs/> Retainage laws in Texas requires the property owner to retain 10% of the contract amount. In addition to retainage, prompt payment laws provide specific reasons that a party is allowed to withhold payment. If there is a <https://www.levelset.com/prompt-payment/texas-prompt-payment-faqs/#faq-item-are-there-reasons-for-which-payment-may-be-withheld-past-the-general-deadline> good faith dispute regarding whether the work was performed in a proper manner, payments may be withheld. On Texas residential projects or four units or less, the maximum amount that can be withheld is 110% of the difference between what the party claims is owed and what the paying party thinks is owed. For all other private projects, this is reduced to 100% of the difference. Interest & Penalties on Private Projects If payment of an undisputed amount is late or wrongfully withheld on a private project in Texas, interest will begin accruing on the overdue payment at an interest rate of 1.5% per month.

## Source

- https://www.levelset.com/prompt-payment/texas-prompt-payment-faqs/

Last verified: 2026-08-14. Review by: 2027-08-14.
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