Even if you find it strange that you need building licenses when your idea is just to create a small business, you will need several permits and licenses both local, state and federal.
Well, you may need a basic license to operate your business or a specific one in addition to a state permit, but…
What are the building permits
You need to know and manage the building permits required by the state where you work because otherwise you will face penalties.
You need licenses for commercial contracting, residential contracting, plumbing, electricity, gas and road work.
License or Registration: Some states require licenses while others only require registration.
Licensing consists of passing exams and meeting certain criteria to demonstrate your competence in a trade.
In the case of registration it is a written record that indicates that you have the ability to do the work but is not a guarantee of experience or competence.
State-by-State Building Licenses
Since not all states have the same requirements on building permits, you will know them state by state as follows:
Alabama requires licensing for contractors and subcontractors if the cost of the project is $50 million for industrial and commercial jobs of at least $10 million for residential jobs and $5 million for swimming pools.
Alaska: Alaska requires a license for commercial and residential contractors. Non-residential contractors are not required to pass the exam but need to complete the commencement program called Craftsman Alaska or complete the post-secondary engineering school cycle and apply for the residential construction endorsement.
If you work in the construction industry performing electrical, plumbing, boilers or handling explosive or hazardous paint work, you must have a certificate of suitability for these operations.
Arizona requires licenses for commercial and residential work. It defines residential construction as semi-detached houses, corporate units, houses and apartments with 4 units or less. The license is required for a project of $750 or more.
As a homeowner in Arkansas you don’t need a license to do the work but as a contractor you must have a license if the work including labor and materials exceeds $2,000.
In the event that you are a subcontractor working with a licensed contractor, you will not need your own license, but if the contractor does not have a license, you will need to apply for one.
In general, California requires a license when the project exceeds $500 even though it involves several projects that reach this amount of money.
In Colorado general contractors do not need to be licensed, but you should review local regulations because they do not require all contractors to obtain a license.
Connecticut differentiates the major contractor from the minor contractor.
The major contractor must have a license to work in residential, nursing homes, jails and other institutions such as motels, hotels, multi-family residences and other large sites.
The minor contractor must be licensed to work in private homes and small multi-family units.
A license is required if the project exceeds $200 or if the annual project exceeds $1,000.
Daleware requires a license for work over $50,000 and a separate license for digging a water well or installing a pump.
Florida: In the case of Florida it has two types of license: certified and registered.
Licensed registered contractor you will work locally while as a certified contractor you can take jobs anywhere in the state.
Georgia: Georgia requires a license if you work in a single-family or two-family home, semi-detached houses less than four stories high and for projects that exceed $2,500 and you will even have to pass the Georgia Business Law Examination.
Hawaii: Hawaii requires a licensed contractor for jobs exceeding $1,000, as it requires electrician and plumbing licenses for specific jobs.
Idaho: Idaho does not grant licenses to general contractors at the state level, but public works contractors must be licensed by the state, while general contractors must be licensed at the local level.
Illinois: Illinois does not issue contractor licenses except for public works and roofs, but the requirements must be reviewed in your area.
Iowa: Iowa requires that all construction contractors be registered with the Iowa Division of Labor if the project reaches a value of $2,000. It considers construction as home improvement projects, construction alterations and new constructions.
Kansas: Kansas requires licenses for shrinkage contractors and water well drills.
Kentucky: Kentucky requires licenses for electricity, air conditioning and plumbing contractors.
As an owner you can do your own plumbing work with the appropriate permits, but for reasons of air conditioning and electrical safety you require a licensed contractor.
Louisiana: Louisiana requires you as a construction entrepreneur to register if your work exceeds $75 million while the limit for home repair and improvement is between $7,500 and $75,000.
If a repair or improvement goes beyond this limit, you as a contractor must register as a construction contractor.
Maine: In Maine although if you are a general contractor you do not need a building license, you need to obtain a business license.
Maryland: In Maryland you will need the contractor’s license for home improvements.
Massachusetts: In Massachusetts you will need a license for construction work even if you are a supervisor.
Michigan: Michigan requires all contractors to have a construction license.
Minnesota: In Minnesota all builders need to obtain a license if the gross revenue equals $15,000.
Mississippi: As a contractor, you require a license in Mississippi if the project exceeds $500.
Missouri: In Missouri, authorization is required only for the work you do in cities with a population of more than 15,000 and you must manage your license locally.
Montana: In Montana as a construction contractor or subcontractor you must register with the Montana work and industry department only if you hire employees.
Nebraska: In Nebraska, as a builder or contractor, you do not require a license or registration if the contract is for more than $2500, but if you work in counties with a population of more than 100,000 you will need a business license.
Nevada: Nevada requires that as a contractor you apply for a license regardless of the contract.
New Hampshire: In New Hampshire you will not need a licence, except for electricity or plumbing work in the building, but the licence will be determined by the circuit type.
New Jersey: As a New Jersey home builder and home repair contractor you must register in the state, so if you are a home improvement contractor you will need a license, unless you receive cash payments for a period of 90 days or less, as in this case you will not need a license.
New Mexico: All contractors in New Mexico need a state-managed license regardless of the contract.
New York: In New York you must look for your license locally because only the reduction of tax requires a statewide license.
North Carolina: If you are a general contractor, you will need a license to do work for $30,000 or more.
North Dakota: If you work in North Dakota you will need a license if the work is worth $4000 or more.
Ohio: In Ohio as a general contractor, you must apply for local authorization regardless of the contract.
Oklahoma: If you work in Oklahoma you need a license and apply for local authorization.
Oregon: Oregon requires you to obtain a license to build a compensation activity, except for handyman projects of less than $1,000, which have to do with minor natural consequences.
Pennsylvania: In Pennsylvania you need to search for your license locally
Rhode Island: In Rhode Island you must register with the Contractor Registration Board for the construction, repair or remodeling of 1-4 family homes.
South Carolina: In South Carolina you will need a residential work license of more than $200.
South Dakota: In South Dakota you must register locally because in principle only shrinkage contractors, electricians and plumbers need licenses.
Tennessee: In Tennessee, you need a license to bid for jobs over $25,000 and masonry jobs over $100.
Texas: In Texas you will only need a license as a specialized contractor, including fire sprinkler systems, well drilling, plumber and pump installation specialist.
Utah: If you work in Utah as a contractor, you must apply for statewide authorization regardless of the type of contract and qualify in one of more than 50 license classifications.
Vermont: In Vermont you must apply for a license as a general contractor or home improvement contractor.
Virginia: In Virginia, you must apply for a construction contractor’s license and authorization from the Virginia Board of Contractors.
You can rate at one of three levels:
Class A for individual contracts of $70,000 or more or $500,000 in one year.
Class B for individual contracts of $7500 to less than $70,000 or 150,000 to less than $500,000 in one year.
Class C for individual contracts from $1,000 to less than $7500 or less than $150,000 in one year.
Washington: In Washington as a general contractor you must register with the Washington State Department of Labor and Industry.
West Virginia : In West Virginia as a contractor or subcontractor you will need a license if the work performed is $2500 or more.
Washington DC: In Washington DC as general contractor you are not required to have a license but you will need it as a subcontractor even if the contractor has a license.
In turn, it determines project cost limits according to the type of license:
A: no limit
B: has a limit of $10 million
C has a limit of $5 million.
D: Class D limit is $2 million,
E: Class E limits up to $500,000.
Wiscosin: In Wisconsin as a construction contractor you must apply for statewide credentials and as a construction contractor you must have a homeownership contractor certification and a qualified housing contrast8sta certification.
Wyoming: As a construction contractor in Wyoming, you must apply for local approval, as only electricians need to apply for approval at the state level.