PRIA Logo™
Title 41 — Public ContractsRelease 119-73not60

§8705 Administrative Offsets

Title 41 › Subtitle Subtitle IV— Miscellaneous › Chapter 87— KICKBACKS › § 8705

Last updated Apr 5, 2026|Official source

Summary

A contracting officer (the official who handles federal contracts) can reduce what the government owes a prime contractor by the amount of any kickback the prime contractor gave, took, or was charged in violation of the law. If the contracting officer directs it, the prime contractor must hold back the same amount from a subcontractor’s pay. The withheld money must either be sent to the agency or kept by the prime contractor if the government already reduced its payment. The prime contractor must tell the contracting officer when it keeps the money. Any such reduction or order is treated as a government claim under federal contracting rules.

Full Legal Text

Title 41, §8705

Public Contracts — Source: USLM XML via OLRC

(a)In this section, the term “contracting officer” has the meaning given that term in chapter 71 of this title.
(b)A contracting officer of a contracting agency may offset the amount of a kickback provided, accepted, or charged in violation of section 8702 of this title against amounts the Federal Government owes the prime contractor under the prime contract to which the kickback relates.
(c)(1)On direction of a contracting officer of a contracting agency with respect to a prime contract, the prime contractor shall withhold from amounts owed to a subcontractor under a subcontract of the prime contract the amount of a kickback which was or may be offset against the prime contractor under subsection (b). The contracting officer may order that amounts withheld—
(A)be paid over to the contracting agency; or
(B)be retained by the prime contractor if the Federal Government has already offset the amount against the prime contractor.
(2)The prime contractor shall notify the contracting officer when an amount is withheld and retained under paragraph (1)(B).
(d)An offset under subsection (b) or a direction or order of a contracting officer under subsection (c) is a claim by the Federal Government for the purposes of chapter 71 of this title.

Legislative History

Notes & Related Subsidiaries

Historical and Revision Notes

Revised SectionSource (U.S. Code)Source (Statutes at Large) 8705(a)41:56(d).Mar. 8, 1946, ch. 80, § 6, 60 Stat. 37; Pub. L. 86–695, Sept. 2, 1960, 74 Stat. 740; Pub. L. 99–634, § 2(a), Nov. 7, 1986, 100 Stat. 3524. 8705(b)41:56(a). 8705(c)41:56(b). 8705(d)41:56(c).

Reference

Citations & Metadata

Citation

41 U.S.C. § 8705

Title 41 — Public Contracts

Last Updated

Apr 5, 2026

Release point: 119-73not60