If you know anything about construction, then you know contractors are always in demand—especially in a large state like Texas.
If you want to start a construction business in the Lone Star State, your first move is to learn about the licensing process. Licensing may be required on the state or local level, depending on your construction specialty—and our guide will take you through all the steps involved in becoming a licensed Texas contractor.
#1. Get to Know the Types of Contractor Licenses
You need a different type of license for different construction activities. Your first step is to figure out which license corresponds to your specialty.
If you want to become a general contractor, you don’t need a state license, but you’ll typically need one on the municipal level, depending on what your local authorities require. The same applies to home improvement contractors.
Specialty contractors including electricians, HVAC specialists, and water well drilling contractors need state-level licensure. The Texas Department of Licensing and Regulation (TDLR) regulates contractors’ activities and issues different license types.
You’ll also need a license on the state level if you want to become a plumbing contractor. These licenses are handled by the Texas State Board of Plumbing Examiners (TSBPE).
#2. Learn the Licensing Requirements
Next, get to know the criteria for licensing. Each license type has different requirements.
For all licenses, you’ll need to register as a business entity in the state. You can use the SOSDirect Business Services Portal to do so. If you’re planning to hire employees, you’ll need an Employer Identification Number (EIN) and workers’ compensation insurance. You may need to undergo a criminal background check too.
You don’t need a state license as a general contractor in Texas. You also don’t need one as a home improvement, roofing, specialty, or right-of-way contractor.
Licensing for these types of contractors takes place on the local level. The requirements vary between cities, counties, and municipalities. They will be different in, say, Austin, San Antonio, and Dallas.
To work as a general contractor in Austin, you’ll need to apply for a General Permit with the city’s Development Services Department.
You’ll need a general contractor registration from the City of Dallas.
Check with your local authorities to learn their licensing process. Some common requirements on the local level include getting a surety bond and general liability insurance, among others.
There are two HVAC contractor license types in Texas. Class A allows you to work on units of any size. Class B license allows you to work on cooling systems of up to 25 tons and heating systems of up to 1.5 million BTUs/hour.
Licensing requirements include:
- Pass a licensing exam
- Get insurance coverage: Class A—$300,000 per occurrence and $600,000 aggregate for property damage and bodily injury; $300,000 aggregate for products and completed operations; Class B—$100,000 per occurrence and $200,000 aggregate for property damage and bodily injury; $100,000 aggregate for products and completed operations
- Pay a licensing fee of $115
To get an electrical contractor license, you’ll need a master electrician license or to employ a person who has this license.
The other licensing criteria include:
- Get insurance coverage: $300,000 per occurrence and $600,000 aggregate for property damage and bodily harm; $300,000 aggregate for products and completed operations
- Pay a licensing fee of $110
Well Driller Contractors
Well drillers must satisfy the following requirements:
- Show their relevant work history
- Pay a licensing fee of $215
You can get four types of plumbing licenses in Texas: Tradesman Plumber-Limited, Journeyman, Master, and Plumbing Inspector.
The licensing requirements are:
- Pass a licensing exam
- Pay a license fee
#3. Get the Necessary Training and Experience
Most license types require relevant job training and practical experience.
To get licensed as a HVAC contractor, you’ll need the following supervised practical experience:
- 48 months over the past 72 months
- 36 months over the past 48 months and a technician certification from the past 12 months
If you want to open your own electrical business, you’ll have to first get a master electrician license, which requires 12,000 hours of on-the-job training.
To get a well-drilling contractor license, you’ll need at least two years of experience under the supervision of a licensed contractor.
You’ll see different training and experience requirements for the various plumber licenses. For the Tradesman Plumber-Limited license, you’ll need 4,000 hours of experience, while for Journeyman—8,000 hours. To get a Master license, you have to complete four years as a Journeyman. For the Plumbing Inspector license, you’ll need 500 hours in the field.
#4. Complete the Required Exam
To get your Texas contractor’s license, you’ll need to pass a state licensing exam:
- HVAC contractors—complete the state ACR exam
- Well drilling contractors—pass a state license exam
- Electrical contractors—complete an exam for a master electrician license first
- Plumbing contractors—take a licensing exam for one of the plumbing license types
#5. Prepare and File Your Contractor License Application
Once you get the necessary paperwork and pass the required exams, you’ll have to fill out an application form.
Here are the application forms:
- Air Conditioning and Refrigeration Contractor License Application (for HVAC contractors)
- Electrical Contractor License Application
- Well Driller or Pump Installer License Application
- Application forms for plumbers
You’ll have to pay an application fee.
Then submit all documents to the right licensing authority.
HVAC, electrical, and well drilling contractors:
Texas Department of Licensing and Regulation
P.O. Box 12157
Austin, Texas 78711
Texas State Board of Plumbing Examiners
P.O. Box 4200
Austin, Texas 78765
If you’re an HVAC, electrical, or water well-drilling contractor license holder, you can always check the validity of your license via the TDLR’s website.
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