How to Become a Licensed Contractor in California

Do you live in the state of California? Are you considering a trade-based career? You may want to consider a career as a contractor. It pays well, and it is a great opportunity, especially if you have a background in construction or another specialized trade.

Before you own and operate your own business, you must obtain a contractor’s license first. Practicing without a license could result in significant fees and even jail time.

Want to learn more about becoming a licensed contractor in California? Read on for more information.

1. Meet the Education and Experience Requirements

To become a contractor, you need a certain amount of experience in the field. Or, the formal education that matches it. You must be familiar with the daily operations of a construction business, including field supervision. You must have at least four years of experience. It must be recent enough to meet state requirements. You may meet the needs if you have a Qualifying Individual (QI).

2. Pass the Appropriate Exams

Before you can become a contractor in California, you must take and pass the following three exams:

Law and Business Exam: This test covers various aspects of construction law and business management. It is dictated by the Contractors State License Board of California.

Secondary trade exam: You will need to pass an exam for your specialty as a contractor. There are several nationally-accredited exams that you can choose. The International Code Council (ICC) offers several popular options. These exams will require specific preparation, so get your materials for National ICC courses at Contractor Training Center or other specialized sites.

Asbestos exam: The asbestos exam is an open-book exam required by CSLB. It covers a range of topics related to the disposal and handling of asbestos. It informs you on how to deal with it within a work setting.

3. Pay the Necessary Fees

On your journey to become a licensed contractor, you’ll encounter fees along the way. Be prepared to pay them. With the exam application, there is usually a $330 fee as well as an initial licensing fee of $200. You will also need to purchase a license bond from a surety bond company. A license bond helps to protect both the public and your clients.

4. Obtain a Business License and Tax ID

If you start your own business, you must obtain an official business license and tax ID. This will ensure that your business is following proper regulations and that your revenue and expenses can be accurately reported for tax purposes. The paperwork for this may seem demanding, but it an important step.

5. Get Fingerprinted

California law requires all licensed contractors to submit a scan of their fingerprints. This is for a criminal background check. You must have a clean record, or you may run into issues. Make sure to apply for it as dictated by the CSLB and pay the appropriate fees.

6. Insurance

You will need to obtain the right types of insurance for your business. If you are an LLC, you will need LLC liability insurance. You will also need to get workers’ compensation insurance. This usually comes in the form of a Certificate of Workers’ Compensation Insurance or a Certification of Self-Insurance of Worker’ Compensation.

Final Thoughts

California has one of the largest economies in the country. As a result, California is booming with opportunities for new contractors. You can be one of them with the right work ethic. But remember to get your license and adhere to all necessary regulations as outlined by the state.