Do I have the right to file a T4C settlement claim?

Yes. If your contract was terminated for convenience, you have the legal right to submit a settlement proposal under FAR Part 49. This right is not discretionary — it is established in the Federal Acquisition Regulation and is binding on every federal agency.

Under FAR 49.201, a settlement proposal is the means by which the contractor and the government negotiate the amount owed for work performed before the termination. The government is obligated to pay allowable costs incurred, earned profit on completed work, and reasonable settlement expenses.

This right exists regardless of contract size, contractor size, socioeconomic program status, or the reason the government terminated the contract. SDVOSB, 8(a), WOSB, HUBZone, and large business contractors all have the same settlement rights under FAR Part 49.

Situations where this right is limited or does not apply: (1) Termination for Default — a T4D does not trigger FAR Part 49 settlement rights; if you believe your T4D was wrongful, you can challenge it. (2) Expired deadline — if one year has passed from the termination effective date without an approved extension, your right to a standard settlement may be lost. (3) Existing settlement agreement — if you already executed a final settlement, that agreement governs.

If none of these exceptions apply, you have the right. File the claim.

RELATED GUIDES

• → What is a T4C?
• → T4C filing deadline
• → Recoverable costs in a T4C settlement