Are you interested in becoming a contractor in the state of Tennessee? If so, you'll need an official Tennessee contractor's license. Navigating that application process, though, can be complex.
That's where we can help. We want to ensure you're approved for your license without any bumps in the road.
After all, reports suggest that there's been a 9.9% increase in the construction industry in Tennessee. In other words, there's a lot of competition out there for your career.
Don't make the mistake of not taking your licensing seriously. Keep reading to learn all the rules and regulations you need to know about for this process.
Are you ready to work towards your Tennessee Contractor's License? We specialize in guiding contractors like you through this process. Learn more about our available Tennessee contractor courses, classes, and exam prep for contractors in Tennessee.
Types of Tennessee Contractor Licenses
Projects that will cost at least $25,000 require a contracting license.
The license may be any of the following:
- Building Combined (BC): this license counts toward all types of projects: residential commercial, or industrial, as well as every type of building category.
- Residential (BC-A): this license allows for the building, repair, remodeling, and improvements of a residential property; that is, a building of no more than three stories.
- Limited Residential (BC-A/r): this license will permit a contractor to bid and work on residential projects, but is limited to single-family homes and only projects of no more than $125,000.
- Commercial (BC-B): this license permits the repair, construction, alteration, or demolition of a commercial property.
- Small Commercial (BC-b(sm)): this license lets you perform duties as a commercial license but only for projects of no more than $750,000.
- Industrial (BC-C): this license covers the repair, construction, remodel, or demolition of industrial buildings such as chemical, manufacturing, or power plants.
Licensing Requirements for Tennessee Contractors
Different types of licenses are available depending on the type of work you plan to do. Examples include work as a limited licensed electrician or home improvement contractor.
Once you have met the qualifications, you can begin the application process. Do this by submitting the necessary paperwork and paying the required fees.
Overall, obtaining a contractor license in Tennessee is a detailed process. It often requires a significant amount of time and effort. That's why it's worthwhile to work with an application review service to better your chances of success.
Don't forget that you will need to file your contracting business and file it with the Office of the Tennessee Secretary of State.
Licensing and Registration Fees
All applicants must pay an application fee and meet certain financial requirements. Applicants must obtain a surety bond, for one thing. They'll also need to maintain liability insurance throughout the duration of their license.
Additionally, contractors need to submit a financial statement to show evidence of their financial responsibility.
Once licensed, contractors must also pay renewal fees. Plus, they have to agree to meet continuing education requirements to maintain their license.
Other financial obligations may include the cost of equipment and tools. It's essential for contractors to carefully budget and plan for these expenses. This is the best way to ensure long-term financial stability and success.
Examination Requirements
Contractor license regulations in Tennessee do require passing the Tennessee Business and Law exam. There are various types of other trade exams for different licenses. The exams cover topics such as building codes, safety regulations, and business practices.
Only Limited Residential contractors are exempt from having to take the Trade exam.
The following types of licenses will require taking the trade exams:
- Commercial
- Residential
- Industrial
- Small Commercial
- Masonry
- MU and MUB
The Trade and the Business and Law Exams are $57 each.
To schedule an exam, you will need to submit an application, pay a fee, and provide any necessary documentation. You may also need to schedule the exam in advance, as testing centers can fill up quickly.
How to Prepare for Your Licensing Exams
Preparing for the exam is important. The good news is that there are various resources available to help you do so, including our Tennessee contractors license exam prep materials. Check out these customer reviews of why past contractors have worked with us in this regard.
Tips for exam preparation include familiarizing yourself with the exam content, to start. You should also take practice exams and review the relevant laws and regulations.
Staying organized and focused during the exam is also important. Be sure to manage your time effectively.
Submitting Your License Application
You are able to submit your Tennessee Contractor's License application after passing the exam. You can do this online through the state Department of Commerce and Insurance. This application package designed by the same body will help ensure you submit all the correct materials.
Along with your completed application, you will need to also include the following:
- A non-refundable $250 filing fee
- A letter of reference from a previous client or employer
- Proof of $100,000 of general liability and workers' compensation insurance
- A copy of your exam scores
- A financial statement prepared by a CPA who has reviewed your finances from the last 12 months prior to your application.
After submitting your application, be sure to have it notarized and have the application postmarked by the 20th day of the month before the next scheduled board meeting. If not, you will need to wait until the next meeting cycle.
How long does it take to get my Tennessee contractors license?
The process can take up to a few months to receive your contractors license in Tennessee. This can include the time required to fill out all the necessary paperwork and register for your exams.
After you've submitted your application, you may need to wait between four to six weeks while it is reviewed and verified. You may be asked to interview briefly with a member of the board during one of their regularly scheduled meetings.
Why You Need a General Contractor License in Tennessee
In Tennessee, you might need a general contractor license for various reasons. First, if you plan to undertake home improvement projects beyond $3,000 in some Tennessee counties, you will need one.
This applies to any individual or business that offers home construction. It also covers repairs and improvements. Obtaining a general contractor license allows you to provide these services legally.
Second, you'll need one if you plan to bid on larger construction projects. Many commercial and public projects require licensed contractors to bid. After all, commercial construction in this state is worth over $3 billion in revenue.
Having a license demonstrates that you have the necessary skills and expertise to complete the project. Plus, it shows you can do so according to the state's safety and building standards.
Lastly, if you plan to work as a construction manager, you will need a general contractor license. Construction managers oversee the day-to-day operations of a construction site. They ensure that projects are completed on time and within budget.
A license shows that you understand the laws and regulations related to construction management. It proves you're qualified to oversee construction projects in Tennessee.
After Earning Your TN Contractors License
Continuing Education Requirements for Tennessee Contractors
Maintaining a contractor license in Tennessee requires continuing education. The number of hours required varies depending on the type of license.
For example, a general contractor must complete eight hours of continuing education annually. An electrical contractor, though, must complete 16 hours every two years.
There are various types of Tennessee contractor license renewal courses available for continuing education. These could include safety training, building codes, and business practices. Some courses may be offered online or in person.
Courses must be approved by the Tennessee Board for Licensing Contractors. That's the only way they'll count towards continuing education requirements. Approved providers include professional organizations, colleges, and private companies.
Failing to meet continuing education requirements can result in penalties. It could even mean license suspension. So, stay up-to-date on the latest industry developments.
Tennessee Contractor License Renewal
Tennessee contractors must renew their licenses every two years to continue practicing.
The renewal process involves submitting forms to the Board for Licensing Contractors (BLC). It also means paying a renewal fee, which varies depending on the type of license.
The BLC will inform you of your need to renew your license via mail 90 days prior to expiration. This notice will include instructions on how to renew your contractor license online. You are recommended to submit your renewal at least 30 days prior to the expiration date.
If a contractor fails to renew their license on time, they may be subject to penalties. These can include additional fees and license suspension. So keep close track of your license expiration date to stay ahead of this.
Business and Safety Requirements
Contractor license laws mean meeting certain safety requirements. One of these requirements is workers' compensation insurance.
This is mandatory for contractors who employ workers. This insurance provides protection for employees in case of work-related injuries or illnesses.
Contractors must also comply with workplace safety regulations. These are designed to ensure safe working conditions for employees.
These regulations cover topics such as hazard communication, for instance. They also include fall protection and electrical safety.
If you plan to contract with government agencies in Tennessee, take note. There may be additional requirements to meet. This may include registering with the state's central procurement office.
Complaints and Disciplinary Actions
In some cases, contractors may face complaints and disciplinary actions. This will definitely happen if they violate state laws or regulations.
Complaints may be filed by consumers, employees, or other contractors. This may relate to issues such as safety violations, contract disputes, or fraud.
If a complaint is filed against a contractor, an investigation may be conducted. This would be done by the Tennessee Board for Licensing Contractors.
The severity of the disciplinary action depends on the nature of the violation. It will also consider the contractor's history of compliance. Repeat offenders may face more severe penalties than first-time violators.
Unlicensed Activity
In Tennessee, it's illegal to perform contracting work without a license. Contractors who engage in unlicensed activity may face fines and penalties. These might be civil penalties or restitution to affected parties.
Additionally, performing work without a license may result in criminal charges. This can lead to fines and imprisonment.
Perhaps your license simply expired without you realizing it. In some cases, the laws might be more flexible. It's up to you to ensure compliance as best as you can.
Consumers should be cautious when hiring contractors. They should always verify that the contractor is properly licensed. Otherwise, they run the risk of getting in legal trouble.
Contract Requirements
Contractors must use written contracts for projects valued at over $1,000. The contract must include specific information, too. That includes the names and addresses of the parties involved. It also requires a description of the work and the total contract price.
Other required information includes a description of any materials you'll use. You'll have to note the project's timeline and the contractor's license status.
Contract terms and conditions may vary depending on the parties involved. Contractors should carefully review and negotiate contract terms before signing.
Contractors may wish to consult with an attorney or other legal professional. This can help to ensure compliance with state laws and regulations. It also helps to protect their interests in contract negotiations.
Dispute Resolution
Disputes can sometimes arise between contractors and their clients. This sometimes happens even with a well-written contract. In Tennessee, there are several options available for resolving disputes.
Mediation is a non-binding process. Here, a neutral third party facilitates negotiations between the parties. This is all in an effort to reach a mutually acceptable resolution.
Arbitration is a more formal process. This happens when a neutral third party makes a binding decision on the dispute after hearing evidence from both sides.
If mediation and arbitration are unsuccessful, the parties may need to resort to court procedures. This may involve filing a lawsuit and presenting evidence in court.
Getting Your Tennessee Contractor's License
Now that you know more about the rules and regulations you need to follow, it's time to take action. Getting approved for your Tennessee Contractor's License is that much closer!
Plus, we're here to help. We specialize in guiding contractors like you through this process. Learn more about our available courses, classes, and exam prep for contractors in Tennessee.