The Full Michigan Contractor License Guide (2021)
There are plenty of opportunities to start a construction business in Michigan. In order to launch your contractorship in legal compliance, you need to obtain a Michigan contractor license.
Depending on the scope of your intended activities, you have to get different license types, which are regulated by either state or local authorities. If you need a Michigan residential builder license, it is required on the state level. However, for commercial construction work, you will need a license from your city or county.
In the guide below, you can find the most important details for starting a contracting business in Michigan. It contains information about obtaining a state-level residential builders license, as well as some particularities about getting a local commercial license.
The Michigan Contractor License Requirements
There are different licensing bodies and requirements for obtaining a Michigan general contractor license.
The licensing authority for state-level licenses is the Department of Licensing and Regulatory Affairs. It offers two options for performing work on projects above $600 – Michigan maintenance and alteration license and builders license. The Department has set specific criteria that you have to satisfy in order to obtain the respective license.
As for getting a Michigan commercial builders license on the city and county level, the licensing bodies are different, depending on your location. You need to check with your local authorities about the exact requirements that they demand from applicants.
Business Entity and Tax Registration
In order to start a business in Michigan, you have to register with the Department of Treasury. This is how you can obtain the necessary tax license and permits, such as income tax, sales and use tax, and unemployment insurance tax. This applies to all types of contractors.
If you want to operate under an assumed name (DBA name), you have to register it with the Department of Licensing and Regulatory Affairs.
Pre-licensing Course and State Examination
Applicants for a Michigan builders license have to complete 60 hours of pre-licensing education. Afterwards, you have to pass successfully the Michigan builders license test, administered through the PSI.
Complete the Michigan contractor license application
Once you’ve made sure you meet all requirements detailed in the previous section, you have to complete the Michigan builders license application.
Then mail it to:
Michigan Department of Licensing and Regulatory Affairs
Bureau of Construction Codes/ Licensing Division
P.O. Box 30255, Lansing, MI 48909
License and Registration Fees
Getting a builders license in Michigan entails that you cover the application fee of $195.
Provide a Surety Bond and Insurance
The Michigan builders license requirements do not include getting insurance or a surety bond. However, these security instruments may be requirements for obtaining your city or county commercial contracting license.
Worker’s compensation insurance
If hiring employees, you may need to get worker’s compensation insurance. You can find out more information from the Department of Labor and Economic Opportunity.
General liability insurance
Your city or county authorities may require you to obtain general liability insurance for your commercial building work.
The city of St Clair and Oakland County require commercial contractors to obtain a surety bond as a part of their local licensing process. The goal of the Michigan contractor license bond is to protect the interests of your customers.
The bond amounts are set by the local authorities. In order to get bonded, you have to cover a small fraction of the required amount. It is called your premium and depends on the strength of your personal and business finances. The rates for applicants with solid finances are usually between 0.75% and 5%.
Want to get the exact cost of your contractor license bond? Complete the short form below!
How to verify your Michigan contractor license
You can check your Michigan builders license via the website of the Department of Licensing and Regulatory Affairs.
License Renewal and Expiration
All types of Michigan contractor licenses have a fixed period of validity. For the residential builders license, it is one year. You thus have to renew it annually. The renewal fee is $185.
Do you need more information about the Michigan contractor license and bonding requirements? You can reach us by calling 877.514.5146.
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