A Step-by-Step Guide to Becoming a Licensed Contractor in Texas

Published: Feb 26, 2021
texas contractor license

 

Are you considering working as a contractor in the state of Texas? You will likely need to get a Texas contractor license from one of the licensing authorities in the state first. The agencies that issue licenses for contractors in Texas are:

 

  • The Texas Department of Licensing and Regulation (TDLR)
  • The Texas State Board of Plumbing Examiners (TSBPE)
  • Local (municipal) licensing authorities

Want to know how to get your Texas contractor license? Follow our step-by-step guide below!

1. Determine the type of Texas contractor license that you require

Before you proceed with applying for your license, you need to determine which licensing authority is the right one for you.

texas contractor license types

  • To become an HVAC or electrical contractor you need to apply at the TDLR
  • To become a plumbing contractor, you need to get licensed with the TSBPE
  • To become a general contractor or any other type of contractor not mentioned above, you do not need to apply for a license at the state level. These licenses are mandated on a local level. You must therefore check whether your municipality or city requires you to get licensed to perform this type of work

Once you’ve accurately determined where you need to apply to get licensed, you can proceed with the next steps!

2. Meet the Texas contractor license requirements

Prior to applying for your contractor license, you must make sure to register your business in the state.

All contractors, with the exception of plumbing contractors, must apply for business registration in the state. General contractors may also be exempt from registering a business but this is determined on the local level.

In order to obtain any of the contractor licenses in the state, you need to meet a list of application and experience requirements. These are as follows for the different types of licenses.

General contractor license Texas

Texas general contractors, as well as home improvement contractors, roofing, specialty, right-of-way contractors, and builders may need to get licensed locally.

To determine whether you need a license, in order to perform any of the above types of work, contact your local authority issuing permits and licenses.

Licensing requirements for these licenses may include:

  • Providing proof of education or experience
  • Passing a Texas contractor license exam
  • Completing and submitting a Texas contractor license application
  • Paying a license application fee
  • Obtaining a Texas contractor license bond
  • Getting liability and/or workers’ compensation insurance

Depending on the local requirements, you may need to meet more or fewer of these requirements.

Texas HVAC contractor license

There are two classes of HVAC contractor licenses issued by the TDLR:

  • Class A allows contractors to work on units of any size
  • Class B allows contractors to work on cooling systems of no more than 25 tons, and heating systems of 1.5 million British thermal units per hour (BTUs/hour) output heating capacity

To apply for a license you must:

  • Meet HVAC contractor education or experience requirements
  • Obtain insurance:
    • For applicants for a Class A license – $300,000 per occurrence for property damage and bodily injury, and aggregate for products and completed operations; $600,000 aggregate for property damage or bodily harm
    • For applicants for a Class B license – $100,000 per occurrence for property damage and bodily injury, and aggregate for products and completed operations; $200,000 aggregate for property damage or bodily harm
  • Complete the Texas HVAC contractor license application form
  • Pay a filing fee of $115
  • Pass a licensing exam – after you submit your application, you will be contacted to attend an exam

Texas electrical contractor license

If you want to get a Texas electrical license, you need to:

Texas plumbing contractor license

There are four different types of plumbing contractor licenses in the state of Texas:

Each of these licenses has different eligibility requirements which you must meet before you can apply. If you are eligible to apply for a license type, you must submit an examination application and subsequently pass the exam. After passing the exam, you will need to pay a license fee.

3. Obtain a Texas contractor license bond

Contractors that need to get licensed on the local level may also need to obtain a contractor license bond as part of the process. Contractor license bonds guarantee that you will perform work in accordance with local building codes and regulations.

The amount of such a bond will differ from one place to the next but will typically be somewhere between $5,000 and $25,000. For example, contractors in Texas city need to post a $5,000 bond. In contrast, contractors in Midland and Lumberton must post a $10,000 bond, while contractors in Cibolo must submit a $25,000 bond.

The amount of the bond is not the same as its cost though. To get bonded, you will be asked to only pay a small percentage of the total amount. This percentage is determined on the basis of your credit score and various other financials. Typically, if you have a high credit score, you can expect to get bonded at a rate between 0.75% and 5%.

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4. Submit your license application papers

Once you have met all of the above requirements, you are ready to submit your application papers to the licensing authority. In addition to these, you will likely also need to submit business registration information.

After the Board, Department, or local licensing authority have reviewed your documents, they will issue your license. You’ve now become a contractor in the state of Texas, congratulations!

5. Renew your Texas contractor license

Texas HVAC and electrical contractor licenses are valid for one year from the date of issuance. To renew your license, you may need to pass a number of hours of continuing education. You will also need to submit a renewal application and fee.

Plumbing contractors typically renew their licenses yearly as well. First-time applicants make an exception and will be assigned a random expiration date for their license, ranging between 6-18 months from the date of passing your exam.

General contractor licenses typically are also valid for one year but this is determined by each location separately.

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Victor Lance is the founder and president of Lance Surety Bond Associates, Inc. He began his career as an officer in the U.S. Marine Corps, serving two combat tours. As president of Lance Surety, he now focuses on educating and assisting small businesses throughout the country with various license and bond requirements. Victor graduated from Villanova University with a degree in Business Administration and holds a Masters in Business Administration (MBA) from the University of Michigan's Ross School of Business.