Can I invoice clients before a project is completed in the US?

Can I invoice clients before a project is completed in the US?

Yes—most of the time you can invoice clients before a project is completed in the US, as long as your billing approach matches what you and the client agreed to and the invoice clearly describes what is being billed. Many businesses invoice upfront deposits, milestone payments, progress billing, or recurring retainers. In fact, invoicing before completion is common in industries like consulting, design, marketing, construction, software development, legal services, and freelancing. The key is to make your invoice accurate, transparent, and consistent with your contract or written understanding, and to avoid implying that unfinished work is already delivered if it is not.

This article walks through the most common ways to invoice early, what to include on the invoice, how to reduce disputes, and how to structure terms that protect both you and your client. It’s educational information for everyday business use, not legal advice for a specific situation.

Why businesses invoice before completion

Invoicing before a project ends is often about cash flow and risk management. Projects can take weeks or months, and waiting until the end to bill can put the entire financial burden on the service provider. Early invoices help you:

• Cover initial costs (software, materials, subcontractors, travel, equipment)

• Reserve time on your calendar and prevent last-minute cancellations

• Reduce the risk of nonpayment after the work is done

• Create predictable cash flow for long projects

• Keep the client engaged and aligned through milestones

Clients also benefit when billing is spread out. They can plan budgets more easily, verify progress along the way, and avoid a large surprise bill at the end.

Is it legal to invoice early?

Generally, yes. In the US, invoicing is a business request for payment. The bigger legal question is whether you are asking for payment in a way that matches the agreement and does not misrepresent what is being delivered. If your contract says “50% upfront, 50% upon completion,” then sending an invoice for the 50% deposit is perfectly normal. If there is no contract, but you have written proof (email, proposal, text message) that the client agreed to a deposit or milestone schedule, early invoices are still common.

However, if you invoice for the entire amount as if the project is already completed and delivered when it is not, you can create problems—especially if the client believes they are being billed for finished work. That does not mean you can never invoice the full amount upfront; it means the invoice must clearly state it is an advance payment, deposit, retainer, or prepayment for future services.

Common billing methods before completion

There are several widely used billing structures that allow you to invoice before a project is finished. Choosing the right one depends on your industry, project length, and how comfortable the client is with paying in advance.

1) Upfront deposits

An upfront deposit (sometimes called a “booking fee” or “project deposit”) is one of the most common ways to invoice early. It’s typically a percentage of the total price—often 20% to 50%—paid before work begins.

Deposits are especially common when you need to block out time, buy materials, or start work immediately. The deposit can be refundable or non-refundable depending on the agreement, the nature of the work, and local rules. Regardless of refundability, the invoice should clearly describe:

• What the deposit covers (e.g., “Deposit to reserve project start date and begin discovery phase”)

• Whether it is credited toward the final total

• The total project price and remaining balance (if applicable)

Many businesses apply the deposit as a credit on the final invoice, which reduces confusion and helps clients see the relationship between early payment and the full project cost.

2) Milestone billing

Milestone billing is when you invoice at specific project checkpoints. For example:

• 30% at kickoff

• 30% after initial deliverables

• 40% upon final delivery

This approach works well when projects have clear phases and measurable outputs. It also reduces disputes because the client pays as value is delivered. For milestone billing to work smoothly, define milestones in plain language—what happens at each stage and what counts as completion of that stage.

A milestone invoice should identify the milestone by name and date range and describe what was delivered or what phase is now starting. If your milestone is for work that is about to begin (rather than already completed), label it accordingly, such as “Milestone 2 payment to begin development phase.”

3) Progress billing (percentage of completion)

Progress billing involves invoicing periodically (weekly, biweekly, or monthly) based on the percentage of work completed or the amount of time spent. This is common for longer, complex projects where milestones are hard to pin down.

Progress billing can be fixed-fee or time-and-materials:

• Fixed-fee progress billing: you invoice for a portion of a fixed total based on completion percentage.

• Time-and-materials: you invoice for hours worked and any reimbursable expenses incurred during the billing period.

To prevent misunderstandings, include a short progress summary on each invoice or attach a statement of work performed. Clients are more likely to pay quickly when they can see what they are paying for.

4) Retainers

A retainer is a payment to reserve your availability or to prepay for a set amount of work. Retainers are common in consulting, marketing, design, and legal services. There are a few types:

• Monthly retainer for ongoing services (e.g., “10 hours per month”)

• Prepaid retainer that draws down as work is performed

• Availability retainer that secures access to your time (sometimes separate from actual service fees)

When invoicing retainers, be explicit about what the retainer means. If it is prepaid time, state how hours are tracked and what happens to unused hours (rollover, expiration, or forfeiture). If it is an availability fee, state that it is for reserving capacity and may not directly convert into deliverables.

5) Subscription-style billing

Some projects are better managed as a subscription, especially if you deliver ongoing outputs rather than a single final “completion.” For example, content production, maintenance, monitoring, SEO, or ongoing development may fit a monthly subscription model.

With subscriptions, you invoice at the start of each billing period for that period’s services. This method can reduce administrative work and keep the client relationship stable, but it requires clear scope definitions so the client understands what is included and what triggers additional fees.

6) Prepayment for specific deliverables

Sometimes clients are willing to pay upfront for a package of deliverables: a brand identity kit, a set number of pages on a website, a fixed number of consulting sessions, or a training workshop. In those cases, invoicing early is straightforward as long as you specify the deliverables, timeline, and what happens if the client delays or changes direction.

How to make early invoicing feel fair to clients

Early invoicing works best when clients see it as normal, structured, and mutually beneficial. Here are strategies that reduce resistance:

Explain the “why” in one sentence. For example: “We take a 40% deposit to reserve scheduling and begin work.”

Connect payments to outcomes. Even if the payment is in advance, tie it to the phase being started, tools being purchased, or capacity being reserved.

Offer clarity, not complexity. A simple payment schedule is easier to accept than a complicated one with many small installments.

Be consistent. When clients see you have a standard process, they trust it more.

Provide a professional invoice. Clear line items, totals, terms, and due dates make payment feel routine rather than negotiable.

What to include on an invoice sent before completion

When you invoice before completion, the invoice itself becomes part of the “paper trail” that defines the transaction. A strong invoice makes it easy for the client to approve and pay, and it helps protect you if a dispute arises later.

At minimum, include:

• Your business name and contact info

• The client’s name and billing address (and email if relevant)

• Invoice number and invoice date

• Payment due date (or “due upon receipt,” if that is your policy)

• Line-item descriptions that clearly match what is being billed

• Quantity/hours, rates, and subtotal(s)

• Taxes (if applicable) and total amount due

• Payment methods and instructions

• Late fee policy or interest terms (if you use them)

For early invoices specifically, add language that clarifies the nature of the payment, such as:

• “Deposit (credited toward final project total)”

• “Milestone 1 payment: discovery phase”

• “Progress billing for work performed from [date] to [date]”

• “Monthly retainer for [month/year]”

• “Prepayment for [deliverable/package]”

If your invoice app supports notes or an internal memo, use the public “Notes” section to restate the schedule in a friendly way: “Remaining balance of $X will be invoiced upon completion,” or “Next invoice will be sent after approval of the design draft.”

Using estimates, proposals, and statements of work to support early invoices

Early invoicing is easiest when it is backed by a written scope. The best practice is to provide an estimate or proposal first, then convert approved items into invoices according to your payment schedule.

A good scope document (often called a statement of work, or SOW) typically includes:

• Project overview and objectives

• Deliverables and what “done” means

• Timeline and client responsibilities (feedback deadlines, access, approvals)

• Pricing model (fixed, hourly, milestone, retainer)

• Payment schedule and due dates

• Change request policy

• Ownership and usage rights (if relevant)

• Cancellation or pause terms

Even a short email that confirms price and schedule is better than nothing. If a client later questions why you invoiced early, you can point back to the agreed terms.

Deposits, retainers, and sales tax: what to watch for

Tax rules vary by state and by the type of product or service you provide. Some services are taxable in certain states, and deposits or prepayments can have special treatment depending on the jurisdiction and what is being sold. Because of this variability, it’s smart to:

• Check your state’s rules (or ask a tax professional) if you charge sales tax

• Label taxable vs. non-taxable line items clearly

• Track the timing of payments and when the service is delivered

For many freelancers and service businesses, sales tax may not apply at all, or it may apply only to certain deliverables (like tangible goods or specific digital products). The safest approach is to configure your invoicing process so you can apply tax only when appropriate and keep clean records for each invoice.

How to avoid disputes when invoicing before completion

Most invoicing disputes are not about the invoice itself—they’re about expectations. The earlier you invoice, the more important it is to eliminate ambiguity. These steps help:

Write payment terms in plain language

Avoid vague phrases like “half now, half later” without defining “later.” Replace them with clear terms: “50% deposit due before work begins. Remaining 50% due within 7 days of final delivery.”

Define what “completion” means

Completion can mean different things: you send the deliverables, the client approves them, the project is launched, or the client accepts the final files. Choose one definition and use it consistently.

Use acceptance and approval checkpoints

For milestones, specify what triggers the next invoice. For example: “Milestone 2 invoice is issued upon client approval of the initial design draft.” This prevents the client from feeling billed “too early” and gives you a clear process.

Document changes

Scope creep is a top reason projects get delayed and payments become contentious. Use a change request process that states: what is changing, how it affects timeline, and how it affects cost. Then invoice for the change separately or adjust future invoices.

Stay consistent with your schedule

If you invoice monthly, invoice monthly. If you invoice on milestones, invoice when milestones happen. Inconsistent billing makes clients wonder if something changed.

Communicate before you invoice

A simple heads-up message can reduce friction: “We’re wrapping up the discovery phase this week. I’ll send the milestone invoice on Friday so we can start development Monday.”

Offer clear payment options

Clients pay faster when it’s easy. Offer at least two payment methods and make instructions obvious. Include your payment link or details and ensure the invoice shows the exact amount due.

What if a client refuses to pay an upfront invoice?

Not every client will accept early invoices, especially if they are new to working with freelancers or have strict procurement rules. Here are practical options:

Negotiate the schedule, not the price. If the client resists a large deposit, propose smaller milestones (for example, 25% / 25% / 50%).

Start with a paid discovery phase. A short, fixed-fee initial phase reduces risk for both sides. After discovery is paid and completed, the client can proceed to the larger project.

Shorten payment terms. If the client insists on paying only after completion, consider insisting on shorter net terms (like Net 7 instead of Net 30) or requiring payment upon delivery before final files are released.

Limit deliverables until payment clears. You can share watermarked drafts, previews, staging links, or partial access until payment is received—if this approach fits your industry and is communicated in advance.

Decline the project if the risk is too high. If a client won’t agree to reasonable terms and you’ll be carrying all the risk, it may be a warning sign.

Should you invoice in advance for hourly work?

Hourly work is usually billed after time is spent, but there are still ways to invoice in advance:

• A prepaid block of hours (for example, 10 hours upfront)

• A weekly or biweekly billing cycle where you invoice frequently

• A retainer model where the client prepays for availability and hours are applied

If you use prepaid hours, spell out how hours are tracked and when the block renews. Also clarify whether unused hours roll over, expire, or are refunded. Clients tend to accept prepaid hours when the scope is ongoing and they value quick access to your help.

Best practices for deposits and refunds

Refund policies can be sensitive. The safest approach is to make the policy unambiguous before the client pays. Common structures include:

• Non-refundable deposit to reserve time (often justified when you turn down other work)

• Partially refundable deposit depending on how much work has been completed

• Fully refundable deposit if cancellation happens within a short window

Whichever approach you choose, define what happens if the project is paused, delayed by the client, or canceled after work has started. Also define how long you will hold availability and what triggers rescheduling fees.

How to handle client delays when you’ve invoiced early

Client delays can turn a well-structured billing plan into a messy situation. If you invoice before completion, you should also include terms for what happens when the client goes quiet or misses deadlines for feedback and approvals.

Consider policies like:

• A timeline that assumes feedback within a specific number of business days

• A “pause clause” that allows you to stop work if payments or approvals are late

• A rescheduling fee if the project restarts after a long delay

• An expiration date for included revisions

These policies are not about being strict—they’re about keeping projects predictable. Clients often appreciate clarity once they understand it prevents endless limbo.

Early invoicing and client trust: how to communicate it

The biggest factor in whether early invoices are accepted is trust. Professional communication builds that trust quickly. Here’s a simple script you can adapt:

“For projects of this size, I invoice in phases. The first invoice is a deposit to reserve time and begin the kickoff work. Then I invoice at agreed milestones so you only pay as we progress. This keeps everything transparent and helps us stay on schedule.”

If a client asks why you don’t bill only at the end, you can keep it short and businesslike: “It’s the standard structure that allows me to dedicate time and resources to your project and keep the timeline reliable.”

Invoice wording examples for billing before completion

Clear wording prevents misunderstandings. Here are examples of line-item descriptions you can use or adapt:

• “Project deposit (30%) to initiate work and reserve production schedule”

• “Milestone 1: discovery and requirements workshop (as per agreement)”

• “Progress billing: design and prototyping work completed from Jan 1–Jan 15”

• “Monthly retainer for February: ongoing support and consulting (up to 10 hours)”

• “Prepayment for Website Package: 5 pages + basic SEO setup”

And in the notes section:

• “Deposit will be credited toward total project fee of $X. Remaining balance invoiced upon final delivery.”

• “Payment due before next phase begins. Work will resume once payment is received.”

When you should not invoice early

There are situations where invoicing early can backfire:

When scope is unclear. If you can’t define deliverables, timeline, or success criteria, clients may feel nervous about paying upfront. Start with a paid discovery phase or a small fixed-scope engagement.

When the client’s process forbids it. Some enterprise clients require purchase orders, vendor onboarding, or specific invoicing rules. In those cases, you may need to adapt your schedule (or decide the project isn’t a fit).

When your deliverables are easily disputed. If the client could claim “it’s not what I wanted” at the end, milestone approvals and defined acceptance criteria become critical. Without them, invoicing early may increase conflict.

When you don’t have a written agreement. Invoicing early without documented terms can lead to confusion. Even a simple email confirmation is worth doing first.

How invoice24 helps you invoice before a project is completed

When you bill in advance, you need invoices that look professional, make payment easy, and keep your records organized. invoice24 is built to support real-world billing workflows, including deposits, milestones, progress billing, retainers, and subscription-style invoicing.

With invoice24, you can create clear line items that explain exactly what the client is paying for, add notes that restate your payment schedule, and generate unique invoice numbers that help both sides track payments. You can also keep client details organized, duplicate invoices for recurring or phased billing, and maintain a clean history of what was invoiced and when—especially useful for long projects with multiple payments.

Because invoice24 is designed for practical day-to-day invoicing, it fits smoothly into the payment schedules described above—so you can spend less time formatting paperwork and more time delivering the work.

Practical checklist for invoicing before completion

Use this checklist to decide whether you’re ready to invoice early and to reduce the chances of pushback:

• I have a written scope, proposal, or clear email agreement

• The payment schedule is defined (deposit, milestones, progress, retainer, or subscription)

• The invoice labels the payment correctly (deposit/retainer/milestone/progress)

• The invoice includes a due date and payment terms

• The client knows what triggers the next invoice and what “completion” means

• I have a plan for changes, delays, and cancellations

• I’m prepared to pause work if payments are not made on time

If you can check most of these boxes, early invoicing is not only acceptable—it’s often the most professional way to run projects.

Bottom line

In the US, invoicing clients before a project is completed is typically allowed and widely practiced. The success of early invoicing depends on transparency and alignment: set expectations upfront, match invoices to your agreement, clearly label what is being billed, and maintain consistent payment terms. Whether you use a deposit, milestone payments, progress billing, or a retainer, the goal is the same—keep the project financially healthy and predictable for both you and your client.

When you’re ready to put this into practice, invoice24 makes it easy to create professional invoices for deposits, milestones, and ongoing work—so you can invoice confidently at every stage of the project.