Like most states in the U.S., Texas contractor license requirements vary. But anyone who wants to perform general contracting work needs to obtain a general contractor license.
Unlike most states, Texas general contractors get their license through their local jurisdiction. However, if you'll also be providing unique services, you will need a state license. These types of specialties include:
- Plumbing examiners
- Fire sprinkler installers
- HVAC technicians (air conditioning and refrigeration)
- Electrical work (master electrician)
Obtaining your Texas general contractor license can be daunting since it’s different from other states. If you’re wondering how to get a contractor license in Texas, keep reading. In this general contractor license Texas article, we'll walk you through the steps.
Do general contractors need to be licensed in Texas?
Texas general contractors have different licensing requirements. This depends on what type of work you do within the construction industry. A contractor in Texas who provides construction services does not require a state license. However, they may need a license to work in a specific city in Texas. This license will come from the local county clerk's office; check with your local municipality or city for requirements.
If you're a general contractor who offers services beyond building and construction, you'll need a state license. For example, heating systems, cooling systems, plumbing, or electrical services require a state license. You need to satisfy certain criteria and pass a test. Your local licensing authority may have additional requirements.
Texas contractor’s license requirements
Register your business
The Texas State Board requires general contractors to apply for a business license before doing anything else. You can do so on a state or county level, depending on your business structure. Various corporation types exist to choose from including LLC, partnership, corporation, or sole proprietor.
Obtain a Texas contractor license bond
In some Texas cities, construction contractors may need to obtain a surety bond before starting construction projects. The exact amount varies by city; check local rules for contractor license bonds. Research local construction bond companies in the area to ensure you get the best deal.
Get a tax ID number
You may also need to register for tax-specific identification numbers, proper licenses, or permits. This includes income tax withholding, sales and use tax (seller's permit), and unemployment insurance tax. Get in touch with Texas Comptroller to learn more about business registration and tax obligations.
If your business includes employees then you need to meet insurance requirements. This includes providing workers' compensation insurance. It can be through a commercial carrier, on a self-insured basis, or through the Texas Department of Insurance.
How do you get a general contractor's license in Texas? Step-by-step guide
General contractors in Texas aren’t required to obtain a state license, except in specialty fields. However, they may need a local one. Let's take a look at how to obtain general contractor licenses in some of the major cities in Texas.
The City of Austin Development Services Department requires permits for contracting work. Here are a few steps to obtaining your license in Austin:
Download and print the official Texas contractors license application form
Provide your name and your authorized agent's name if any
Determine your scope of work (Commercial or Residential)
Commercial Usage - For three-story buildings or higher
Residential Usage - For smaller buildings like single-family and duplex structures
Provide the address of the project
Describe all of the work you will be performing in detail
Submit your building permit number/s
Fax the completed form to the permit center
Pay the application fees and the license fee
The Permit Center should contact you within 24 hours after applying. Once approved, you should:
Check the current fee schedule for the applicable "residential review." This is simply an inspection of the property before work begins.
Pay the fee through an escrow account. You can set up an escrow account by signing up on the Austin Development Services Department secure portal. You can appoint up to 6 agents to conduct business on your behalf and use the escrow account. This allows you to fax your permit request form and pay the fees instantly.
Local law in Dallas states that contractors must apply for contractor registration. Regardless of the license type you're applying for, you'll only need one form. Here's what you'll need to do:
- Choose whether you are a new contractor or renewing
- Determine your license type:
- Gas Well Provider
- Energy Code Provider
- Green Building Provider
- General - Commercial, Residential, Roofing, Fence, Foundation, Demolition, and Pool Contractor
- Provide your name, Responsible Party, and Company information
- List personnel who are authorized by you to sign permit applications for your company
- Sign the Contractor Registration Affidavit
- If applicable, declare if your home is your place of residence via a Home Occupation Declaration
- Sign, notarize and submit the application
- Pay application and registration fees. To do so, you'll need to set up an account through the Dallas Online Application and Inspection page. For information on how to set up an account and make payments, check out the How to Instructions page.
To work as a general contractor in San Antonio, you need to apply for one of two types of registration. The City of San Antonio Development Services Department offers a home improvement contractor license and a residential building contractor license.
The home improvement contractors are those who do minor repair work. The residential building contractor license is for those who do more extensive construction work.
To acquire either license, you'll need to go through a criminal history background check by the San Antonio Police Department. You'll also need to pay a separate fee for the background check.
Home improvement contractor registration
The home improvement contractor's license allows you to oversee repairs, replacement work, non-structural remodeling, and modernizations on existing buildings. Examples include window and door repairs or replacements, re-roofing, fence or deck installation, painting, and non-structural carpentry.
To register for your home improvement contractor license you'll need to include the following:
Completed and notarized Home Improvement Contractor Registration application. Be sure to include the criminal history background check form and attach it to the end of the application.
Government-issued photo ID
Letter of Authorized Agents if any. If you’re authorizing others to secure building permits, etc. on your behalf, you'll need to provide an authorization letter. The letter should be written on your company letterhead with the full name of the agent. If you have no letterhead, a notarized letter is acceptable.
Pay the application, registration, and background check fees
Residential building contractor registration
The residential building contractor license allows you to engage in new residential construction or alter existing homes. For example, making structural changes or foundation repairs.
You need to submit the following items to obtain a residential building contractor license:
The completed and notarized Residential Building Contractor Registration Application
The criminal background check form
Government-issued ID card
Letter of Authorized Agents if any
Certificate of liability insurance with The City of San Antonio as the certificate holder. Coverages required include:
Property damage and bodily injury: $400 per occurrence
Total for property damage and bodily injury: $1 million
Total liability for products and completed operations: $400,000
Pay all application, registration, and background check fees
Home improvement specialists and residential building contractors should send their registration application and fees to:
Cliff Morton Development and Business Services Center
1901 South Alamo Street
San Antonio, TX 78204
However, you'll need to take the background check application and fees directly to the San Antonio Police Department at:
San Antonio Police Department (SAPD) Identification/Latent Prints
315 S Santa Rosa
San Antonio, Texas 78207
To find licensing information for all other cities in Texas:
- Check out the Texas Municipal League's City website.
- Scroll through and find the city in Texas that you want to work in. This should take you to the city's government website.
- Search for “contractor license requirements”
Some people get confused by the Texas Department of Licensing and Registration website. Also, every local website will be different. Just spend some time doing your research. This will ensure that your contracting business abides by the laws to avoid Texas contractor licensing penalties.
How hard is it to get a contractor's license in Texas?
This depends on the type of license you're after. If you're a general contractor wanting to do simple construction work, it is very easy to get your license. However, if you are going to be offering other services you'll need a license issued by the state.
There are unique processes to obtain a state plumbing contractor license, electrical contractor license, refrigeration contractor license, HVAC contractor licenses, and more. The processes are easy but may take a bit longer.
How often does a Texas contractor's license need to be renewed?
This will depend on the type of license you're going for and the city you operate in. In Dallas, a general contractor needs to renew their license annually. In San Antonio, it's every 2 years. Check local regulations in the city you work in to ensure you renew your license on time.
Next steps after getting your Texas contractors’ license
General contractors in Texas can consider themselves lucky since they are not required to have a state license. However, this depends on whether or not they provide more than minor construction services.
While they don’t require a state license, the city they operate in may require a local license. Regardless of which one you need, certain requirements must be met before you can apply for a license. These include registering your business, applying for a Tax ID number/s, and acquiring general contractor insurance.
Once you've become a licensed contractor, you can create a Bing listing and start growing your construction business.
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