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How Much Work Can You Do Without a Contractor License?

How Much Work Can You Do Without a Contractor License?

Next Insurance Staff
By Next Insurance Staff
Aug 21, 2018
5 min read
If you’re wondering out how much work can you do without a contractor license, you’re probably trying to decide if you actually need to get a license. Unfortunately, there’s no simple answer to either of these questions. There are, however, a few things to consider as you make the decision:

What Is a Contractor License?

A contractor license is an official certification that allows you to take on different kinds of construction jobs. There are a few different types and each state has different requirements. The most common types of contractor license are general contractor, subcontractor, electrician, roofer, and plumber. In some states, the different types of licenses will define exactly what kind of jobs you can or cannot do. In other states, you are allowed to take on jobs worth up to a certain amount of money without a license. Once you decide if getting a contractors license is right for you, make sure to check out your specific state’s contractor license requirements.

Why Would I Want a Contractor License?

The primary reason you might want to get a contractor license is that there are a lot of jobs you can’t legally take on without it. Contracting without a license for these kinds of jobs can get you fined for thousands of dollars. Whether your state defines these jobs by monetary value or by work type, the result will be the same: you will only be able to take on small projects. You won’t be able to take on anything taking more than a day or requiring more than basic skills. In other words, the most lucrative jobs won’t be an option. You can see this in the case of many of the handyman license requirements, which cap jobs quite low. Even if you expect most of your jobs to be small ones, a contractor license can still help you. It lends you credibility and helps build trust. These are key factors in the numbers of jobs you get and even in how much you can charge for the same work. This is just one in a list of things that, while not legally mandated, can show your customers that you are above board. Proof of contractor’s insurance, references, and by-the-book financial paperwork are other great ways to demonstrate your reliability and professionalism. Nonetheless, remember that when your clients are looking around and they’re comparing a licensed contractor vs non licensed contractor, nothing will replace that license.

Are There Downsides to a Contractor License?

Despite everything, it may not make sense for you to get a contractor license right now. In some states, licenses require a fairly significant investment of time and money. You might need to take tests, gain documented work experience, pass a background check, and go through a lot of bureaucracy. In the meantime, you may be able to reach your professional and financial goals without it. In fact, in some states, a contractor license can limit the jobs you can do. For example, without a license you may be getting your income by assembling and installing furniture, repairing flooring, and repainting rooms. But if you were to get a specific type of contractor license, such as electrician, plumber, or carpenter, you would only be able to do jobs that required that particular expertise. In these cases the question of how much work can you do without a contractor license is especially relevant.

How Do I Decide?

With these pros and cons, you may still be wondering if a contractor license is the way to go. Here are a few questions you should ask yourself:

What Are My State’s Regulations?

The way your state has structured these regulations will make a big difference in your decision. You will always be limited if you don’t have a license, but the benefits may outweigh that cost. Check out what you can do without a license, if the license brings any other limitations with it, and how much time and effort you would need to get the contractor license.

How Much Experience Do I Have?

In some states, you may actually need work experience in order to get a license. But instead of trying to figure out how to get a contractors license with no experience, try to figure out how to get experience with no license. Consider apprenticing or taking on small jobs that don’t require a license. Not only will you be working toward your license, you will also get a better idea of the business side of things so that you can make the most of every job once you have your very own license. This is your chance to figure out what kinds of jobs you most enjoy so that you can be sure to get the right type of contractor license. That way in the future you won't need to ask how much work can you do without a contractor license of a different sort.

What Types of Service Do I Want to Provide?

Some people like the security of large jobs – a week or two spent rebuilding a kitchen, with a big payoff at the end. Others prefer the flexibility of helping lots of people in one day – putting up a shelf here, fixing a broken step there. You may decide you like the fine detail of electrical work or hate getting wet doing plumbing. When you’re deciding whether you need a contractor license, and which one, don’t forget to take into account your personal preferences and goals. As you can see, how much work you can do before it’s time to get a contractor license is only part of the decision. How much you can take on depends on your state, but what that means for you depends on your experience, skills, and resources.
Next Insurance Staff
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