Licensing Guides
State Contractor License: How to Become a General Contractor in Tennessee
Contractor, TN
Table of Contents
Why Do You Need a Contractor License in Tennessee?
How Can You Get a Contractor License in Tennessee?
Types of General Contractor Licenses in Tennessee
What Are the Requirements of a Tennessee Contractor License?
How Long Does It Take to Get a Contractor License in Tennessee?
How Much Does It Cost to Get a Contractor License in Tennessee?
Tennessee Contractor License Training Programs and Schools
Does Tennessee Reciprocate Contractor Licenses?
Do I Need to Renew my Contractor License in Tennessee?
Are There Any Penalties for Contracting Without a License in Tennessee?
We all need a place to live and work, and those buildings require upkeep and repair. They’re often the biggest investments we make in our lives, and keeping them in good condition is essential. We count on professionals to know how to fix damage to or wear and tear on our homes and businesses. General contractors are typically the experts we rely on to help us with these repairs, and we need these men and women to know what they’re doing.
Many states require contractors to be licensed. Others simply require solid insurance to back up the essential work they perform. There are 520,900 construction managers and 1,599,800 construction laborers and helpers nationwide, according to the Bureau of Labor Statistics (BLS). Tennessee employs 6,930 managers and 24,830 laborers and helpers. The national number for managers is projected to grow 9% from 2023 to 2033 and 8% for laborers and helpers. In Tennessee, according to CareerOneStop, the U.S. Department of Labor’s job search website, the projected growth rate for laborers is more than triple the national number at 25%, and for managers it’s more than double the national number at 23%. If you’re thinking about becoming a contractor or you want a job in the field, you need to know the requirements in your state or local jurisdiction. This guide will help you determine what you need before you get started.
Why Do You Need a Contractor License in Tennessee?
Tennessee requires general contractors performing commercial and residential construction, remodeling, or repair to hold a state license for projects with a total cost of $25,000 or more.
Contractors performing residential remodeling work costing $3,000 to $24,999 may need to hold a Home Improvement License, but this only applies in specific counties that have adopted that law. Counties requiring a Home Improvement License include:
Bradley
Davidson
Hamilton
Haywood
Knox
Marion
Robertson
Rutherford
Shelby
The state also requires different types of contractor licenses for specific trades or specialties. We cover contractor license classifications in more detail below.
How Can You Get a Contractor License in Tennessee?
The Tennessee Board for Licensing Contractors issues and regulates contractor licenses. The process for getting a contractor license in Tennessee is clearly outlined on the Board for Licensing Contractors’ website.
Contractors, or a qualifying individual for the business, must pass a trade exam and a state business and law exam. When contractors submit their license application, they must show proof of business registration and insurance. They must also submit a financial statement for the monetary limit of their license, which is the amount approved for contracting or bidding.
Types of General Contractor Licenses in Tennessee
Tennessee classifies contractor licenses based on the type of work and monetary limit.
Contractors bidding or offering a price for projects costing $25,000 or more for materials and labor must hold a prime or general contractor license. Subcontractors performing electrical, mechanical, plumbing, HVAC, and roofing work also need a contractor’s license when their portion of the project is $25,000 or more. Construction management professionals also must have a contractor’s license when the project costs $25,000 or more.
Tennessee contractor license classifications are as follows:
Building Construction (BC): Those holding a license in this classification may bid and perform work in 34 building categories, including foundations, drywall, and carpentry.
Residential BC-A
Limited Residential BC-A/r: Restricts residential contractors to building projects costing $125,000 or less.
Commercial BC-B
Small Commercial BC-b(sm)
Industrial BC-CB
Masonry (LMC): Must be licensed as a contractor when the masonry portion of the project costs $100,000 or more.
Heavy Construction (HC)
Highway, Railroad, and Airport Construction (HRA)
Municipal and Utility Construction (MU)
Mechanical Contracting (CMC)
Electrical Contracting (CE)
Specialty, Specialty/Environmental, and Specialty/Medical Gas Piping (S)
For projects less than $25,000, the state requires these licenses:
Home Improvement License (HI): For projects costing $3,000 to $24,999 but only in specific counties.
Limited Licensed Electrician (LLE)
Limited Licensed Plumber (LLP)
HVAC License
Getting a general contractor license
The bottom line is that you need to be licensed in the state of Tennessee to do any kind of commercial or residential construction, remodeling, or repair when the total cost is $25,000 or more. The state also requires licenses for projects less than $25,000 for certain trades or in specific counties. Here’s how you go about getting a contractor license.
TAKE LICENSING EXAM: A contractor license requires passing two contractor exams–a trade exam and the Tennessee business and law exam. Each exam costs $55. Individuals acting as the qualifying agent for the business obtaining the license must pass a trade exam given by PSI Services. The individual taking the business and law exam does not need to be the same person taking the trade exam. Trade exams vary based on the type of license. Tennessee has trade exam waiver reciprocal agreements with several states, detailed in the reciprocity agreement section below. Applicants qualifying for exemption from the trade exam will still need to take the state’s business and law exam. For more information about exam requirements, exam prep, and registering for PSI exams, visit this page.
PREPARE FINANCIAL STATEMENT: The state requires contractors to submit a reviewed or audited financial statement prepared by a licensed independent accounting firm, such as a certified public accountant (CPA) or a licensed public accountant (LPA). Whether the contractor submits a reviewed or audited statement depends on the monetary limit of the license. For more information on financial statement requirements, visit this page.
PROVIDE LETTER OF REFERENCE AND PROOF OF INSURANCE: Contractors must submit a letter of reference, proof of general liability insurance based on the contractor’s monetary limit, and meet state workers’ compensation insurance requirements. For more information on the reference letter and proof of insurance, visit this page.
SUBMIT PROOF OF BUSINESS REGISTRATION: Limited partnerships must register with the state. Limited liability companies must submit a copy of the articles of organization and corporations must submit a copy of the charter. Both LLCs and corporations must show proof of registration with the Tennessee Secretary of State’s Office. Contractors also must obtain local business tax licenses for each city or county where their business performs work. For more information about proof of business registration, visit this page.
COMPLETE CONTRACTOR’S AFFIDAVIT: Submit a notarized contractor’s affidavit signed by all applicable individuals, including qualifying agent, owners, partners, members, main officers, and major stockholders. For more information about the contractor’s affidavit, visit this page.
APPLY FOR LICENSE: Apply for the contractor license online. You’ll first need to create an account with the Tennessee Department of Commerce and Insurance. The department provides this online application resource to guide contractors through the process. If you can’t complete an online application, you can call the Board for Licensing Contractors in Nashville at (615) 741-8307 to ask them to mail a paper application. For more information about submitting an application, visit this page.
PAY APPLICATION PROCESSING FEE: Pay the $250 initial license and application fee when you submit your application.
Getting a residential or specialty license
For residential construction, the state offers a Residential (BC-A) License or a Limited Residential (BC-A/r) License, which restricts residential contractors to building projects costing $125,000 or less. Residential licenses and certain specialty licenses for projects costing $25,000 or more need to follow the steps above to apply for a contractor’s license.
The state also has a Home Improvement Contractor license for projects costing $3,000 to $24,999, but this only applies in specific counties. The license requirements are slightly different from the contractor license. For more information about Home Improvement Contractor License requirements, visit this page.
Some specialty trades require contractors to hold a contractors license if their portion of the project is $25,000 or more. They include:
Electrical contractors
Mechanical contractors
Plumbing contractors
HVAC contractors
Roofing contractors
Masonry contractors must be licensed as a contractor when their portion of the project costs $100,000 or more.
Other types of contractor license classifications have different exam or monetary requirements. For example, some licenses do not require a trade exam and have experience or certification requirements. Requirements for all classifications are listed on this classification outline PDF.
For more information, you can also consult our guides to getting your HVAC license, plumbing license, or electrical license in Tennessee.
What Are the Requirements of a Tennessee Contractor License?
There are business and financial prerequisites.
You, or a qualifying individual in your business, must pass a trade and business and law exam.
Register your business with the Tennessee Secretary of State’s Office and submit proof of registration.
Obtain and submit a financial statement prepared by a licensed, independent CPA or LPA.
Submit a letter of reference.
Submit proof of general liability insurance.
Meet workers’ compensation requirements.
Complete a contractor’s affidavit.
Apply for a contractor license.
Pay application and initial license fee.
How Long Does It Take to Get a Contractor License in Tennessee?
The length of time it takes to get licensure depends on how quickly you take your exams and gather the required business and financial information.
It takes four to six weeks to obtain a license after submitting your application. Contractor applications must be submitted by the 20th of the month prior to the Board for Licensing Contractors meeting. The board meets every other month. Information about board meetings are posted on this page. Applicants can check their license status online.
What Business Owners Need to Know
Being efficient in the contracting world, no matter where you are in your licensing journey, takes work. ServiceTitan’s cloud-based, all-in-one contracting software gives workers and business owners in residential field service, commercial contracting, or new construction, the technology they need to do the work efficiently, and the data they need to do it effectively.
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Location-specific service history, including recorded calls, accessible from the mobile app.
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Sales presentations that make conversations with customers easier and drive the average ticket.
Mobile payment acceptance, eliminating lost checks and increasing cash flow.
To learn more, schedule a demo with a product expert today.
How Much Does It Cost to Get a Contractor License in Tennessee?
It costs $250 to get your contractor license in Tennessee. In addition, you’ll need to pay $55 each for the trade exam and the business and law exam.
Tennessee Contractor License Training Programs and Schools
There are no specific educational or course requirements to get a contractor license in Tennessee. However, training programs throughout the state can help you prepare for a career in construction.
If you choose to start your career path at a college or university, you can pursue a degree in construction management or construction engineering. There are many higher education options throughout the Volunteer State that offer these types of programs.
The following schools offer a Construction Management, Engineering Technology-Construction, or Construction Engineering and Management Bachelor of Science degree, or a construction concentration.
Through The College System of Tennessee, many community and technical colleges offer degrees and diplomas in the areas of construction and the trades.
If you don’t attend any formal schooling or training, but want to learn on the job, you may want to consider an apprenticeship. Find registered apprenticeships in the construction field through Apprenticeship TN, powered by the Tennessee Workforce Development System.
Other resources for finding Tennessee apprenticeships in the skilled trades include:
Through an apprenticeship, you work, accumulate necessary experience, and can earn money all at the same time. The length of time to complete an apprenticeship depends on the trade and program.
The #1 newsletter for the trades.
Does Tennessee Reciprocate Contractor Licenses?
Tennessee does not reciprocate contractor licenses, but has trade exam waiver reciprocal agreements with several states. This means if you’re actively licensed in those states and the Tennessee contractor license you’re requesting has a trade exam, you may qualify for a trade exam waiver. You’ll still need to take the Tennessee Business and Law exam.
States with reciprocal agreements or exams qualifying for a trade exam waiver include:
Alabama: General, electrical, residential, and HVAC
Arkansas: Commercial/residential building only
Georgia: Electrical only
Louisiana: Residential, commercial, electrical, and mechanical
Mississippi: Residential, commercial, electrical, mechanical unlimited
North Carolina: Residential/commercial building, electrical
Ohio: Electrical, plumbing, and HVAC
South Carolina: Commercial Contractors Licensing Board
West Virginia: Residential, commercial, industrial building, electrical, mechanical, masonry
National Association of State Contractors Licensing Agencies (NASCLA): National Commercial and Electrical Exams only
Do I Need to Renew my Contractor License in Tennessee?
Yes, Tennessee contractor licenses must be renewed every two years. License renewal costs $200. Notices to renew online are mailed to licensees 90 days prior to expiration date with online renewal instructions.
The board provides a grace period of 12 months. Those who renew during the grace period are charged a $20 per month late fee. After the grace period, the licensee must complete the reinstatement application online.
Renewal requires supporting documentation. Some licenses require continuing education for renewal. More information about renewal, temporary inactive status, or reinstatement is on this page.
Are There Any Penalties for Contracting Without a License in Tennessee?
Yes. The Executive Director of the Board for Licensing Contractors can issue citations against those acting in the capacity of or engaging in the business of a contractor without a license. Each citation carries a civil penalty of $50 to $1,000, according to board rules.
National Certifications
Other certifications can help you demonstrate your proficiency to potential employers and clients. There are many professional organizations that offer certification. These certifications are not required but can add to your marketability and therefore increase your opportunity to make more money.
Some of the top construction certifications are:
Occupational Safety and Health Administration (OSHA) Safety Certificate
Construction Management Association of America Certified Construction Manager (CCM)
National Association of Safety Professionals (NASP) Certified Safety Manager (CSM) certification
National Center for Construction Education & Research (NCCER)
Continuing Education
In Tennessee, those licensed after Jan. 1, 2009, with the Residential BC-A, the Limited Residential BC-A/r, and the combined Residential BC-A,b(sm) must complete eight hours of board-approved continuing education before license renewal.
Residential contractors with licenses expiring on Jan. 31, 2022, and thereafter also will be required to show proof of eight hours of board-approved continuing education before license renewal.
An individual designated as a qualifying agent on the contractor’s license will be responsible for attaining residential continuing education on behalf of the licensed entity. A list of residential continuing education providers is on this PDF.
Contractors will also want to stay informed about emerging technology in the industry. There are many ways to keep yourself current in regard to the technology put to use in construction, roofing, energy and environmental designs, efficiency standards, and more. For example, distributors want you to know about their company’s latest offerings and will often hold training sessions about new and changing equipment and parts. Another option to stay in the know is continuing education courses with the Associated General Contractors of America (AGC).
Resources
You can stay up to date on contracting industry news several ways:
Check top blogs, including ServiceTitan’s blog.
Read about the latest industry trends, and discover ideas on how to grow your business.
Listen to top podcasts like ServiceTitan’s “Toolbox for the Trades” podcast.
ServiceTitan is a comprehensive business software solution built specifically to help service companies streamline their operations, boost revenue, and achieve growth. Our award-winning, cloud-based platform is trusted by more than 100,000 contractors across the country.
Ready to learn more about what ServiceTitan can do for your business? Contact our team to schedule a demo today.
