Many general contractors find it difficult to set up their business in New York because the state’s licensing requirements can be quite confusing. This is because instead of a general, statewide New York contractor license, licensing requirements are handled at the city level.
This guide will walk you through this process of determining if your business needs any contractor licenses as well as how to obtain them in your local municipality.
Tip: If you’re planning to work as a general contractor in New York, we recommend forming an LLC. This is an affordable business structure that protects your personal assets against debt and/or lawsuits.
Northwest Registered Agent ($29 + state fees)
Do You Need a Contractor License
In New York, not all contractors are required to obtain a specific license. Instead, licensing requirements vary depending on your specific trade and the location you’re based in. We’ve explored these considerations in greater detail below.
Contractors in New York aren’t required to obtain a license at a statewide level unless they work in one of the three specialist professions outlined in more detail in the next section.
Because local regions within the state often set their own rules, however, you’ll likely need to obtain one license or another. In Buffalo, for example, home improvement contractors must file an application for a home improvement contractor license with the Department of Permit and Inspection Services before they can begin to offer their services.
Asbestos Removers, Crane Operators, and Elevator Contractors
New York requires only three types of contractors to obtain a license the a state level:
- Asbestos Removers
- Crane Operators
- Elevator Contractors
While this highlights the statewide licenses these specialist contractors need, they also may have to satisfy additional local licensing requirements based on their municipality.
Interested in starting your preparation for the contractor licensing exams? We recommend using online study materials and prep courses to give yourself the best chance of success.
How to Get a Contractor License in New York
Becoming a general contractor in New York is relatively straightforward since the state doesn’t mandate a license. This means there are no specific age, experience, or education qualifications that you must meet at a state level to be able to offer these services.
However, if you intend to perform any work in a specialist trade (i.e., as an asbestos remover or crane operator), there are certain steps your business will need to follow in order to get licensed in New York. While the specifics of these steps vary between each trade, you will generally need to do the following:
Step 1: Choose Your Business Structure
Before starting the application process for a contractor license, you’ll first need to decide on the structure of your business. Since this decision will impact your liability, tax obligations, and how you run your business, it’s vital you’re informed about the details of each structure so that you can effectively determine which one is best suited to your needs.
Many contracting businesses in New York, particularly smaller ones, decide to structure themselves as an LLC because it grants them tax flexibility, limited liability protection, and credibility in the eyes of their clients.
Recommended: More than 72% of our readers form their LLC using a professional filing service. Our recommended service provider is:
Northwest Registered Agent ($29 + state fees)
Step 2: Meet the Basic Requirements
After forming your business, you’ll need to confirm that you meet the minimum basic requirements. While the specifics of these requirements will vary depending on the license you are trying to obtain, you’ll generally need to:
- Be at least 18 years of age
- Be a US citizen or legally reside in the country
- Have no convictions of a disqualifying offense
- Demonstrate a certain number of hours of on-the-job training and experience. For example, in the area of heating, ventilation, and air conditioning (HVAC)
Note: Some licenses (e.g., the master electrician license) require you to have held a more junior qualification in that industry for a certain amount of time. In this case, applicants must have held a journeyman’s license for at least two years before applying to become a master electrician.
Step 3: Submit an Application
Once you’ve confirmed that you meet the basic requirements of the license your business needs, the next step is to complete and submit the appropriate application form to the New York State Department of Labor (NYSDOL) along with any associated fees.
We’ve explored this process for the specialist trades in New York that require licensing:
- Asbestos Removers: Any contractors that handle asbestos must submit an application to the NYSDOL along with their driver’s license and evidence of completing the New York State Department of Health’s asbestos training course
- Crane Operators: To legally operate cranes independently in New York State, contractors must first obtain a license from the NYSDOL. You can apply for several specific licenses, ranging from unrestricted (Class A) to specialized types like hydraulic (Class B) or boom truck (Class C)
- Elevator Contractors: Any contractors who focus on elevators or accessibility lifts must submit an application to the NYSDOL for an elevator contractor license to operate legally
Step 4: Pass a Licensing Exam
While not a universal requirement, many contractor licenses in New York require applicants to pass a licensing exam in order to qualify. For example, crane operators must take an exam administered by the NYSDOL after their application has been approved.
Many candidates struggle with these exams as they will often test both their knowledge of the trade and their understanding of New York’s specific regulations and laws. To avoid this, many applicants take advantage of online study guides and preparatory courses in order to get ready for these exams.
Step 5: Satisfy Insurance Requirements
In order to protect both your business and the client in case of accidents and damages, most contractors in New York will need to provide proof of insurance coverage in order to get licensed. For example, elevator contractors must hold:
- Disability insurance
- Workers’ compensation insurance
- General liability insurance as well as property damage and personal injury insurance with a minimum value of $1 million for each incident
Many local governments in New York also impose a surety bond requirement, such as New York City’s requirement that all contractors with a home improvement license need a surety bond from an insurance company or a preferred private insurance carrier in the amount of $20,000.
Be sure to check the specific insurance prerequisites for the license you’re seeking as well as the surety bond requirements of your local municipality, as these requirements will be unique to each trade and city in New York.
Step 6: Keep Your Contractor License Valid
Once you obtain your license, it’s essential to keep it active. This often involves renewing it every few years, paying associated renewal fees, and meeting continuing education requirements.
For example, elevator contractors must renew their license every two years in order to continue offering their services without interruption.
Congratulations! You’ve now successfully obtained the professional license needed to work as a contractor in New York. However, your licensing journey doesn’t end here, as there are additional licensing requirements your business will need to satisfy in order to operate legally.
Other Licenses You May Need
Below, we’ve explored the various additional licenses and permits that your New York contractor business may need in more detail.
State Business Licenses
While general contractor licenses aren’t required at a state level in New York, there are certain state business licenses you may need to obtain before you can get up and running.
Because the building materials and services a general contractor provides to their clients as part of a construction project are generally taxable, for example, you’ll likely be required to get a sales tax identification number and file to pay sales and use tax to the New York State Department of Taxation and Finance.
Additionally, your general contractor business may require a health permit from the New York Department of Health and Mental Hygiene if it takes on certain types of projects with the potential to impact the safety or well-being of the public.
To better understand your general contractor business’s licensing requirements, check out our in-depth New York Business License guide.
Note: There are a range of different fees associated with registering your business in New York. To get an idea of how much it would cost to get your contracting business off the ground, you can find these fees on the New York State Department of State website.
City and Municipal Licenses
Many local municipalities often impose their own additional requirements that you may be required to satisfy for your business to operate legally in that area.
New York City, for example, has its own specific licensing requirements for general contractors. These include submitting a basic license application to the Department of Consumer and Worker Protection (DCWP – formerly the New York City Department of Consumer Affairs), passing an exam, and providing a variety of documents as proof of their residency, business address, and workers’ compensation insurance (e.g., a utility bill or insurance certificate).
In another example, Westchester County requires both a contractor license and a business certificate for contractors who work on residential projects. While the license is obtained at the state level and includes passing the contractor exam, the business certificate is filed with the county clerk’s office in the borough where the business is based.
To help applicants prepare for the contractor exam, the DCWP designed a Home Improvement Examination Guide focused on the law in this area.
Note: This overview is far from exhaustive, so be sure to check your local municipality’s specific contractor licensing requirements by using the New York State Department of State’s Local Laws Search tool.
New York Contractor License FAQ
How do I get a contractor’s license in New York?
Because many local counties and municipalities have their own licensing criteria, you’ll need to check with your local government to learn about the specific application process, fees, and exams you’ll need to complete to get a contractors license. Alternatively, our How to Get a General Contractor License article explores this topic in more detail.
Do you need a license to be a contractor in New York?
New York State generally doesn’t require contractors to have a state-level license. However, individual counties and municipalities within the state often have their own licensing requirements that contractors must meet to operate legally. Our New York Contractor License article provides an in-depth breakdown of these requirements.
What licenses are needed to start a construction business in New York?
Starting a construction business in New York may require various licenses, depending on your specialty and where you plan to operate. You’ll need to adhere to local general business law, which can involve application fees, examinations, and insurance requirements.
Can a New Jersey-licensed contractor work in New York?
A contractor licensed in New Jersey isn’t automatically eligible to work in New York. Contractors must meet the licensing requirements of the specific New York county or municipality in which they intend to work. As an example, you’ll need to satisfy specific requirements outlined by the NYC Department of Consumer and Worker Protection in order to avoid civil penalties in this city.