How long are annual appropriations available for new obligations?

How long are annual appropriations available for new obligations?

• A. 2 years
• B. 3 years
• C. 1 year
• D. 4 years

Answer: (C)

When you’re dealing with annual appropriations, the important timing rule is how long funds can be used to incur new obligations. These appropriations are provided for a single fiscal year, and they are available to incur new obligations only during that year. Once the fiscal year ends, the money generally lapses unless a law provides otherwise (for example, no-year or multi-year funding). So the duration for new obligations with annual appropriations is one year. The other timeframes describe funding that is not typical for annual appropriations.

When you’re dealing with annual appropriations, the important timing rule is how long funds can be used to incur new obligations. These appropriations are provided for a single fiscal year, and they are available to incur new obligations only during that year. Once the fiscal year ends, the money generally lapses unless a law provides otherwise (for example, no-year or multi-year funding). So the duration for new obligations with annual appropriations is one year. The other timeframes describe funding that is not typical for annual appropriations.