How to Get a North Carolina Contractor License

The state of North Carolina offers a variety of contractor licenses, including general and specialty licenses – such as electrical, landscape, plumbing, heating and fire sprinkler licenses.

Different types of licenses are issued by different licensing bodies. As a result, the application process and licensing requirements can vary significantly between professions.

For some licenses, such as general, electrical and landscape contractor licenses, there is a statewide requirement to obtain a North Carolina contractor license bond. For others, such as plumbing and heating licenses, there are city-level requirements.

Read on for more information on how to get any type of contractor license.

Step-by-Step Guide to Getting a Contractor License

1. Determine the license limitation and classification you require

The state of North Carolina issues various licenses for contractors. The exact license issued will depend on the type of work being carried out. Because each license classification is different, it’s essential you apply for the correct license before you start work. Read on to learn about the different licenses available.

General Contractor License

To perform work as a general contractor on projects that cost $30,000 or more, you must obtain a license from the NC Licensing Board for General Contractors. 

The licenses issued by the board under 21 NCAC 12A.0202 have the following classifications:

• Building: Covers all building construction and demolition activity
• Residential: Covers all residential building construction and demolition
• Highway: Covers all highway construction activity
• Public utilities: Includes demolition and operations on water and wastewater systems
• Specialty: Includes specialty licenses such as roofing and others

Additionally, all of these licenses are issued with three different limitations:

• Limited: Authorized to act as general contractor on projects worth up to $750,000; Must have at least $17,000 in working capital, a net worth of $80,000, or a $175,000 surety bond
• Intermediate: Authorized to act as general contractor on projects worth up to $1,500,000; Must have at least $75,000 in working capital or a $500,000 surety bond
• Unlimited: Authorized to act as a general contractor without restriction as to value; Must have at least $150,000 in working capital or a $1,000,000 surety bond

Electrical Contractor License

To obtain a North Carolina electrical contractor license you’ll need to apply to the State Board of Examiners of Electrical Contractors. The board issues 10 classifications of electrical contractor licenses. These include the limited, intermediate and unlimited classifications that allow contractors to perform residential, commercial and industrial work on different scales.

The board further issues a license that permits electricians to work on single-family detached residential dwellings.

There are six special restricted electrical contracting classifications that only allow for a limited scope of contracting work to be performed. These are the:

• Fire alarm/low voltage
• Elevator
• Plumbing, heating, and air conditioning
• Groundwater pump
• Electric sign
• Swimming pool

Landscape Contractor License

Landscape contractor licenses in North Carolina are issued by the NC Landscape Contractors’ Licensing Board. The board issues two types of licenses: individual and corporate.

According to the North Carolina General Statutes (N.C.G.S.§89D-11 (3)), a landscape contractor is anyone who:

“[…] for compensation or other consideration, does any of the following: a. Engages in the business requiring the art, experience, ability, knowledge, science, and skill to prepare contracts and bid for the performance of landscape services, including installing, planting, repairing, and managing gardens, lawns, shrubs, vines, trees, or other decorative vegetation, including the finish grading and preparation of plots and areas of land for decorative utilitarian treatment and arrangement.”

Plumbing, Heating and Fire Sprinkler Contractor License

Finally, the state of North Carolina issues licenses for plumbing, heating and fire sprinkler contractors. It also issues fuel piping licenses. These are issued by the State Board of Examiners of Plumbing, Heating and Fire Sprinkler Contractors.

There is a variety of licenses in each of these categories. The main distinctions between them are that Class I licenses cover systems for all types of buildings, while Class II licenses are limited to single-family detached dwellings only.

2. Pass the exam

Take and pass the relevant NASCLA exam.

3. Prepare an audited financial statement for your company

The audit process involves a comprehensive examination of your company's financial transactions, assets, liabilities, revenue, and expenses. 

4. Apply for and secure your surety bond

To get licensed in North Carolina, general, electrical and landscape contractors are required to obtain a surety bond. This is a statewide requirement that applies to all contractors.

Apart from this requirement, the cities of Winston-Salem and Greensboro require certain applicants to get bonded.

In all of North Carolina, general contractors must provide:

• A $175,000 bond when applying for a limited license
• A $500,000 bond when applying for an intermediate license
• A $1,000,000 bond when applying for an unlimited license

Electrical contractors who apply for intermediate and unlimited license classifications must provide a $50,000 bond for the former and a $130,000 bond for the latter.

A $10,000 NC landscape contractor bond is required of all applicants for a landscape contractor license. This is the surety bond that Nancy, our client from Wilmington, needed once her gardening and landscaping business took off. 

A $2,000 surety bond is required of all applicants in the city of Greensboro for an electrical, plumbing, heating, air conditioning, mechanical, refrigeration, HVAC and concrete contractor license. Contractors who perform demolition, grading and house moving in the city, must post a $5,000 bond. 

In the city of Winston-Salem, heating and electrical contractors must post a $2,500 bond. Street, bridge, and sidewalk contractors must post a $20,000 bond.

The reason contractors are required to obtain a bond is to guarantee that they will comply with state and city laws and regulations. If contractors violate these regulations, a claim can be filed against the bond and claimants can be compensated for any damage or loss they experience due to violations.

5. Register your business

Choose your legal entity structure and register your business with the North Carolina Secretary of State.

6. Apply for a FEIN

Apply for a Federal Employer Identification Number (FEIN) from the Internal Revenue Service (IRS).

7. Submit your application and pay your license fees

To get any of the above licenses, applicants will need to apply at the respective State Board. This can be done by submitting the relevant application form, passing a qualifying contractor exam and, in some cases, submitting financial requirements such as a surety bond.

Application fees for a North Carolina contractor license are as follows:

• General contractor license – $75 for a limited, $100 for an intermediate, and $125 for an unlimited license classification
• Electrical contractor license – $85 for a limited, $130 for an intermediate, and $180 for an unlimited license classification
• Landscape contractor license – $75 application fee, and a $60 licensing fee
• Plumbing, heating and fire sprinkler contractor license – $75 fee for a fire protection sprinkler contractor’s license, $150 for a plumbing/heating license, and $300 for a fire sprinkler license

When applying, you’ll be required to pay examination fees which differ from license type to license type. Once you pass your license exam and your application is approved by the board, your license will be issued.

If you’ll be applying for an electrical or landscape contractor license, don’t forget to post the corresponding surety bond.

Who Needs a North Carolina Contractor License?

According to North Carolina General Statutes § 87-1(a), all contractors who wish to perform work on projects worth $30,000 or more must obtain a contractors’ license.

If you’re working on projects worth less than $30,000, you aren’t required to apply for a general contractor license. However, becoming a licensed contractor can make you look more professional, reassure your clients and help you to secure future work.

FAQs

How Much Work Can You Do Without a Contractor License in North Carolina?

If you don’t have a contractor license in North Carolina, you’ll only be able to work on projects worth up to $30,000.

Is There a Difference Between Applying as a Qualifier or Licensee?

The licensee is the person that has met all the requirements for the license, while the qualifier is defined as the owner of the licensed entity, officer, or individual responsible for managing employees

How Hard Is the NC General Contractor Exam?

To obtain your general contractor’s license, you will have to pass the NASCLA contractor exam. This test requires an in-depth knowledge of the building codes in North Carolina, experience in construction activity and an all-round understanding of the industry. 

The exam consists of 90 questions and takes around three and one-half hours. Under N.C. Gen. Stat. § 87-10(b), you must receive a minimum score of 70% to pass the exam. There are courses you can take to prepare you for the exam. Find out more at nclbgc.org.