These Illinois contractor payment deadlines are the working half of our Contractor Prompt Payment Act overview. Owners: see the foreign-owned LLC guide.
What the law requires: Illinois contractor payment deadlines
| Requirement (815 ILCS 603 section) | What it says |
|---|---|
| Owner payment (10(1)) | If the contractor performed under the contract, the owner pays within 15 calendar days of approving the payment application. For non-conforming work, withhold only its reasonable value. |
| Deemed approval (10(1)) | Approved once 25 days pass after receipt, unless the owner has sent, before then, a written statement giving the reason and the amount withheld. A lender or architect instruction is not approval. |
| Pay-through (10(2)) | Contractors and subcontractors pay within 15 calendar days after receiving payment, the full amount for a subcontractor's accepted work. |
| Late payment (15) | 10% yearly interest, not duplicated with Mechanics Lien Act interest. Suspension is allowed after 7 calendar days' written notice. |
| Retainage (20) | At most 10% of any payment before the job is half done; no more than 5% held from halfway. |
Key numbers and dates
| Item | Amount or period | Year; section |
|---|---|---|
| Owner pays after approval | 15 calendar days | 2026; 10(1) |
| Application deemed approved | 25 days after receipt | 2026; 10(1) |
| Contractor pays subcontractor | 15 calendar days after receipt | 2026; 10(2) |
| Late-payment interest | 10% a year | 2026; 15(a) |
| Notice before work is suspended | 7 calendar days, written | 2026; 15(b) |
| Retainage cap | 10% before halfway; 5% from halfway | 2026; 20 |
Source: 815 ILCS 603/10, 15
Recent amendments and open items
- The source notes read October 27, 2026 show no amendment after Public Act 101-432 (effective August 20, 2019), and an ilga.gov search for "815 ILCS 603" in the 104th General Assembly found nothing (not exhaustive).
The named checklist: the Galena Boulevard Pay-Clock Check
- Scope. Confirm private Illinois work, not a home or a building of 12 or fewer units.
- Day zero. Record the date each payment application arrives.
- Day 25. Send any withholding statement, with amount and reason, before day 25.
- Day 15. Diary 15 days after approval and after each receipt.
- Retainage. Check the 10% and 5% caps at halfway.
- Notice. Give 7 calendar days' written notice before suspending work.
- Records. Keep applications and notices for your bookkeeper.
Common mistakes
- Missing the 25-day statement, and so leaving the application deemed approved.
- Treating a lender or architect instruction as approval.
- Holding back the whole amount for a small defect.
- Holding over 10% retainage before halfway, or not dropping to 5%.
When to bring in an attorney
- A payment dispute, lien claim or Mechanics Lien Act deadline.
- Deciding whether to suspend work, or whether an exclusion applies.
- A project partly public and partly private.
How we can help
Our Aurora CPA firm handles the U.S. tax, payroll and accounting side, (bookkeeping, real estate investor tax, business tax returns) alongside your attorney, Canadian CPA or Indian CA.
Frequently asked questions
Does the Act apply to my home or apartment building?
Not to single-family homes, multi-family buildings of 12 or fewer units, or public-funds contracts.
How soon must an owner pay a contractor?
The owner has 15 calendar days from approving a payment application. Silence for 25 days after receipt means approval unless a written withholding statement is sent.
What happens when payment is late?
Interest of 10% per year applies, and an unpaid party may suspend work following 7 calendar days of written notice. The Act sets no fine.
Is retainage capped on private jobs?
Yes: at most 10% of each payment before halfway, then no more than 5% held.
Official sources
- Illinois General Assembly: Contractor Prompt Payment Act, 815 ILCS 603
- Illinois General Assembly: House Bill 1224 status
- Illinois General Assembly: Public Act 104-168
This page summarizes public guidance in plain language. If anything here differs from the official source, the official source controls.