The SF-24 Bid Bond is the standard form for the bid guarantee on federal construction bids. It promises the government that if you win, you'll sign the contract and provide the required performance and payment bonds. If you don't, the surety pays. For the basics of bonding, see bid bonds explained.
Free tool: Check your bond amounts with the free bid and performance bond calculator.
When you need one
- When the solicitation requires a bid guarantee. That's normally whenever performance and payment bonds will be required, which for construction means contracts over $150,000 (FAR 28.101-1 and 28.102-1).
- The solicitation will include a bid guarantee clause and tell you the amount. Read section L or the instructions.
How much: the 20% rule
The bid guarantee must be at least 20% of your bid price, but not more than $3 million (FAR 28.101-2(b)), unless the solicitation says otherwise. You can state the penal sum as a percentage ("20% of the bid price") or as a dollar amount. A percentage is safer, because the bond still covers you if you change your price at the last minute.
Who can be your surety
- A corporate surety listed in the Treasury Department's Circular 570, acting within its underwriting limit. This is what most small contractors use, through a surety bond agent.
- Individual sureties are allowed, but they must pledge assets and file an SF-28 Affidavit of Individual Surety, which gets extra scrutiny.
- Instead of a bond, some solicitations accept a certified check, cashier's check or irrevocable letter of credit.
Filling in the SF-24
| Date bond executed | Must be on or before the bid opening date. |
|---|---|
| Principal | Your company's legal name and address, exactly as in SAM.gov and on your bid. Mark the type of organization. |
| State of incorporation | Where your company is registered. |
| Surety(ies) | The surety company's name and address. |
| Penal sum | Percentage of bid price, or amount in dollars, plus "not to exceed" if used. |
| Bid identification | Bid date and solicitation number, matching the bid exactly. |
| Signatures | Your authorized signer, and the surety's attorney-in-fact, with corporate seals where required. |
Attach the surety's power of attorney for the person who signed for it.
Mistakes that make a bid nonresponsive
- No bid guarantee when one is required, or one received late.
- Penal sum below the required amount.
- Wrong principal name, or a surety that isn't on Circular 570.
- Missing signatures or power of attorney.
A missing or defective bid guarantee usually means the bid is rejected (FAR 28.101-4); only narrow exceptions apply. Get your surety lined up weeks before the bid is due.
Frequently asked questions
How much is a federal bid bond?
The penal sum is normally at least 20% of the bid price, capped at $3 million. The premium you pay the surety is usually small, and many sureties don't charge for bid bonds for established clients.
Is the SF-24 required for every federal bid?
No. Only when the solicitation requires a bid guarantee, which usually means construction contracts over $150,000.
What's the difference between the SF-24 and the SF-25?
The SF-24 guarantees your bid. The SF-25 performance bond and SF-25A payment bond are provided after award. See performance and payment bonds.
Want the bid package done for you?
We prepare the full construction bid package and tell you exactly what your surety needs to issue, from $950 for a Full Bid. You set the price, sign and submit. See the contracts that fit you.