Home Improvement Contractor Company License
Registered home improvement contractor companies must meet a number of business requirements, including licensing requirements, which vary by state. Learn more about obtaining a home improvement contractor license.
Home Improvement Contractor Companies: An Overview
Home improvement contractors oversee construction projects on residential properties. The company owners are responsible for crew safety, equipment and site safety, permits, street closures, and quality and safety standards enforcement.
If you are interested in starting your own construction company, ideal qualifications include the following:
- Attention to detail
- Budget experience
- Building skills
- Organizational skills
- Time management
If you naturally have those skills, or are prepared to adopt them, and are interested in starting a home improvement company, you will need to understand how to start your own business. At times, especially in the beginning, the process can seem complex. Fortunately, Harbor Compliance can help.
If you are concerned about managing the business registration process on your own, you can seek guidance from the business licensing experts at Harbor Compliance. With our professional licensing services, you will understand all of the stages of corporate compliance and have access to full-service support and expert software insights.
We make preparing and filing applications easy and we handle communication with government agencies on your behalf. With our software, you can track your registration status, license numbers, filing history, fees, and renewals 24/7.
Qualifications to Become a Home Improvement Contractor
State requirements to start a home improvement contractor company vary. Most require general business registration, some form of certification or licensing, and insurance. While it is unlikely you can expedite the process, ensuring you qualify and have all of the requirements fulfilled before submitting your business application will ensure a smoother process.
Education and Experience
While most states do not require formal education to work as a home improvement contractor, obtaining enough entry-level experience to understand the construction industry is essential. Most homeowners want to hire contractors who are certified and have insurance in place in case an accident were to happen.
Many general contractors start by shadowing a contractor with experience. Home improvement contractors will benefit from exposing themselves to many different areas of construction. In addition to real-world experience, home improvement contractors can pursue a voluntary certification from the National Association of the Remodeling Industry (NARI). Individuals with at least five years of experience may apply. The accreditation involves coursework and an exam. It covers codes, laws, safety standards, and industry-specific skills.
While state requirements vary, businesses are generally required to register for tax identification numbers, licenses, and permits with their state. That includes income tax withholdings, sales and use tax, and unemployment insurance tax.
Most states offer online business registration. You will need to choose your business name and entity structure. The most common forms for home improvement businesses are sole proprietorships, LLCs, and corporations. Once you have done that, you can file your application with the state. Registration fees may apply.
Once your business registration application has been approved, you can work on submitting the required licenses or permits in order to conduct work. Along with those documents, you will also want to have a comprehensive insurance policy in place.
Given the nature of the construction industry, accidents happen. No matter the size of your business, you are exposed to risks and liability like accidents, property damage, negligence, and injuries. To protect your business in the event a homeowner, employee, or bystander is injured, it is crucial to have adequate insurance coverage in place. The most common types of insurance coverage contractors need include:
- General Liability - covers bodily injury to another person, third-party property damage, personal and advertising injury, medical expenses
- Workers’ Compensation - covers medical payments, lost wages, rehabilitation expenses, death benefits
Depending on your business’s needs and risks, you can add many other coverage types to your policy. Not only does your insurance protect your business, but it can also make it easier to get your contractor’s license, meet state requirements, and make clients feel better about working with you.
How to Get a Home Improvement License
If your state, city, or locality requires a home improvement license, you may need to pass a licensing exam on topics like home improvement, business, and labor laws. An online or in-person course typically precedes the exam, which may be instructor lead or self-taught. There are also states requiring additional salesperson training and licensure to ensure contractors know how to negotiate contracts with homeowners properly.
While receiving a home improvement license is one of the first steps in starting your own company, you will need to ensure you maintain the license’s status. State requirements vary, but renewals are often required on an annual basis. You may need to submit a renewal application, pay a renewal fee, or pursue continuing education. You will also need to appoint a registered agent to receive notices of lawsuits and other legal or government notices.
Keeping on track with your business’s home improvement license renewals can be complicated, especially as a growing company. At Harbor Compliance, our Entity Manager software ensures accurate due date tracking and on-time filing. This way, your business will continue to be compliant with state and local requirements, and you will have the time you need to continue working and expanding your clientele.
Click on a link below to view licensing information in your state.
Meeting the home improvement contractor company license requirements is not always an easy process. Fortunately, Harbor Compliance License Manager helps construction professionals maintain their licenses by automating repetitive tasks such as tracking renewals. Through License Manager, you can also access LicenseIQ™ - our extensive, proprietary database of nationwide licensing information - to research the requirements for the states in which you work. These tools reduce the time you spend researching state requirements and prepare your organization for success. Contact our licensing experts today to learn more.
Associated General Contractors of America
Professional association providing advocacy and organization for construction firms and workers.
National Association of Home Builders
National association for the promotion of the housing industry.
National Association of State Contractors Licensing Agencies
National organization that represents and promotes the interests of state level contractor licensing agencies.