A punch list is generally a list of tasks or "to-do" items. In the U.S. construction industry, a punch list is the name of a contract document used in the architecture and building trades to organize the completion of a construction project. In other places, it is also commonly known as "snag list".
In the United States construction industry, contract agreements are usually written to allow the owner to withhold (retain) the final payment to the general contractor as "retainage". The contractor is bound by the contract to complete a punch list of uncompleted contract items in order to receive final payment from the owner. The designer (typically a licensed Professional Architect or Engineer), is usually also incorporated into the contract as the owner's design representative and agent, to verify that completed contract work has complied with the design.
The typical construction contract agreement calls for the contractor, when he believes it to be so, to declare the construction project to have reached "substantial completion" and request a "pre-final" inspection. The architect then observes the project as a whole in a "walk around" inspection and creates a punch list of uncompleted or unsatisfactory work items owed to the project as defined by the contract agreement (which also incorporates the design documents). Final contractor payment is made when the punch list of items are completed to meet the project design required by the contract, or some other mutually agreed resolution for each item is reached. Examples of punch list items include damaged building components (e.g. repair broken window, replace stained wallboard, repair cracked paving, etc.), or problems with the final installation of building materials or equipment (e.g. reinstall peeling carpet, replace missing roof shingles, fire and pressure test boiler, obtain elevator use permit, activate security system, etc.).
The phrase takes its name from the historical process of punching a hole in the margin of the document, next to one of the items on the list. This indicated that the work was completed for that particular construction task. Two copies of the list were punched at the same time to provide an identical record for the architect and contractor.