Texas is one of the fastest growing states in the U.S. With thousands of people flocking to the Lone Star State every month, contractors are in high demand. Busy homeowners, landlords, and renters need skilled tradespeople to help them build, repair, remodel, and maintain their properties.
Resourceful contractors could benefit from this building boom. But before getting to work, it’s important to determine if you need a license or permit to operate legally in the state or your city.
This article covers general contractor license requirements in the Lone Star State, including whether you need a handyman license in Texas and the insurance obligations that small business owners may need to meet.
Do I need a contractor license in Texas?
Some categories of tradespeople must apply for a state-level license to work in Texas, including electricians, plumbers, and HVAC contractors. Licenses in these areas are issued by the Texas Department of Licensing & Regulation (TDLR). Each specialty has its own requirements that you must meet to become licensed.
Additionally, all contractors in Texas must apply for a business license, regardless of the trade they work in.
All tradespeople who perform electrical work need to be licensed in Texas. This includes installing, maintaining, and extending electrical wiring systems in residential and commercial properties.
There are currently 11 different licenses covering the trade, from apprentices to master electricians. Each electrician license has its own requirements that you must meet to apply. Generally, you will need a minimum amount of work experience or on-the-job training and to pass the electrician exam.
Texas issues four types of plumbing licenses:
- Tradesmen Plumber-Limited
- Plumbing Inspector
To apply for a license, you must meet the requirements set by the Texas State Board of Plumbing Examiners. You will typically need a minimum amount of experience, complete an approved education program, and pass an exam.
There are two HVAC contractor licenses available in Texas:
- Class A – Contractors can work on any size HVAC unit
- Class B – Contractors can work on cooling systems 25 tons or less, and heating systems of 1.5 million BTUs/hour or less
Both licenses require you to have at least 48 months of work or education experience and pass the Air Condition and Refrigeration exam.
Local General Contractor Licenses
Other tradespeople—including handymen, carpenters, and painters—do not need a state-level contractor license to work in Texas. However, you may need a local general contractor license and permits to work in certain cities around the state.
General contractor license requirements vary by city or municipality. Here are the basic licensing conditions in two Texas cities to give you an idea of what might be expected in your area:
Tradespeople must register as a general contractor in Austin and apply for a project-based permit through the City of Austin Development Service Department.
Permit applications generally require:
- Whether the project is commercial (triplex structures and higher) or residential (duplex and single-family homes)
- Project address
- Your building permit numbers
- A description of the project
Contractors in San Antonio need to apply for a license through the city’s Developmental Services Department. Licenses are issued based on the type of work you do, such as home improvement or residential building.
You will need to pass a background check and provide a certificate of liability insurance if you are applying as a residential building contractor.
Do Texas contractors need business insurance?
Tradespeople may need General Liability insurance to obtain permits or a contractor license in Texas. Additionally, this form of coverage may be required to work with some clients, businesses, and government agencies.
Unlike other states, Workers’ Compensation insurance is not mandatory in Texas. However, if you want to bid on government contracts, you will need a policy. Government agencies that may require contractors to have Workers’ Compensation coverage include:
- Public employers, such as city, county, or state agencies
- State universities
- Companies that provide transportation on public highways
- Businesses that employ inmates through work furlough programs
- Liquid propane gas and compressed natural gas dealers
Getting Texas Contractors to Work
The licensing landscape in Texas is sometimes confusing for new contractors. As you can see, answering the question “Do I need a contractor license in Texas?” can be complicated to answer. Before beginning trade work in the state, it may be wise to contact your local licensing or small business authority for guidance.