Every state has different licensing requirements for those wanting to become general contractors. While some states require just about all contractors to obtain a license, others leave the matter of licensing to cities and counties to figure out. In areas where you need a license, you will need to submit an application, prove you have sufficient working capital to operate as a contractor and prove you have previous work experience in the industry or pass an exam to prove your knowledge of local contracting laws.
What Can You Do With a General Contractor's License?
What you can do with a general contractor's license varies based on your state. Some states do not even offer general contractor's licenses, and others require anyone doing even minor construction work to obtain a license.
If your state does issue licenses, you may need one to work on commercial or residential properties. Failure to obtain a license in a state that requires them could subject you to fines or even jail time. Additionally, operating outside the law means you will have no legal recourse if a client refuses to pay you.
How to Get a General Contractor's License by State
Some states don't require general contractors to get licenses, though individual counties or cities may require their own licenses. For example, in Indiana, only plumbers are required by the state to obtain a contractor's license, all other licenses are issued at local levels. In states that do require general contractors to be licensed, the process is drastically different from state to state, for example:
Alabama: Those who work on commercial or industrial jobs valued at more than $50,000; a residential job over $10,000; or a swimming pool project valued at over $5,000 need a general contractor license. In order to get a license, you must have working capital of $10,000 or more and general liability insurance. You must also pass the state's Business/Project Management Exam and the Skill Test Exam. Finally, you will need to complete the application and submit a fee of about $300.
California: California requires anyone working on a job that exceeds $500 to obtain a contractor's license. Those seeking a license must fill out an application form; pass a background check; pass an exam; and provide the required information, which includes work experience, personnel forms, worker's compensation insurance and more. Those who have been working in the construction industry continuously for the last five years or who have a general contractor's license from Arizona, Nevada or Utah may be exempt from taking the California exam.
Louisiana: Louisiana does not offer one specific general contractor's license, so instead, contractors need to apply for a license based on the project type they plan to work on. Most contractors will want to obtain a commercial license for projects over $50,000, a residential license for projects over $75,000 or a home improvement license for projects between $7,500 and $75,000. To obtain any of these licenses, contractors must fill out an application and provide proof of insurance, proof they have over $10,000 in net worth, and pass relevant exams or complete mandatory training.
How Many Years of College Do You Need to Be a General Contractor?
You do not need to attend college to become a general contractor, although its helpful to have either a degree in construction management or experience in the construction industry. In some states, like California, on-the-job experience is required to obtain a general contractor's license. With or without a degree, contractors need to be well-versed in building codes in their area, construction methods, materials, surveying, project safety, reading blueprints and creating estimates.
Requirements for a general contractor's license vary greatly by state, so review your local state, county and city ordinances to find out what is required in your area.
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