Lindsay Lohan -- Probation Dept. Pooh-Poohs 'Hit-and-Run' Allegation

The L.A. County Probation Department has written a report for Lindsay Lohan's final court appearance Thursday ... and the Dept. will NOT recommend that Lindsay's probation be violated based on the allegation that she committed hit-and-run earlier this month.

Probation Dept. sources tell TMZ ... the report makes mention of the allegation by Thaer Kamal, the manager of the Hookah Lounge who claims Lindsay struck him and his car, and then fled. The probation report makes mention of the incident and says it's under investigation by the police department, but the probation officer discounts the claim and gives it no weight ... saying no charges have been filed and Lindsay has not been arrested.

The Probation report reads in part, "The probationer (Lindsay) is in compliance with the terms and conditions of probation." The report recommends that probation continue the way it's been going, but that is standard for these reports. Judge Stephanie Sautner has said if Lindsay is in compliance as of Thursday, she will terminate probation in the Beverly Hills DUI case, and change Lindsay's status from formal to informal probation in the jewelry heist case -- which means she won't have to appear in court anymore.

As we previously reported, Kamal's lawyer, Mark Geragos, has asked Lindsay's lawyer for 6 figures, claiming there's a surveillance video showing the hit-and-run, but sources tell us the video shows no such thing.