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 Is it possible to document retainers and deduct time billing from these retainers?

Right now DL doesn't record retainers, only payments on invoices. We are looking at offering the ability to hold retainers and apply them to proposals and time charges both but it won't be till around summer that that feature will be live. 

We have added this feature in, in case you haven't seen it in your account. Retainers are in the Project Dashboard, where each project can accumulate retainers and then apply them to various invoices over time.