Residential and General Contractor Licensing Information: When Do You Need a Licensed Contractor?
Planning to build or remodel a home, a commercial building, or considering some other type of construction that would require the use of a residential contractor or general contractor? You need to know about Georgia’s Residential and General Contractors Licensing Law.
When do I need a Licensed Contractor?
Not all construction activity requires a state license but a great number of activities that require building permits do require a state contractor’s license. Your Georgia legislators enacted licensing legislation to protect you as a consumer. Contractors who are not required to have a state license are limited in the work they may perform or in the size of the projects they may undertake.
State contractor licensing safeguards consumers to regulate and protect against faulty, inadequate and unsafe contractors. State licensed contractors must meet requirements as to competency, ability, integrity and financial responsibility. State licensed contractors are required to show proof of workers compensation insurance, when state law requires a business to provide this insurance. They are required to have general liability insurance. General contractors are also required to meet financial thresholds established by the licensing board. State licensed residential contractors are required by Georgia law to offer a written warranty where the total value of the work or the compensation to be received by the contractor for such activity or work exceeds $2,500.00.
Georgia law prohibits anyone from engaging in the business of residential or general contracting without a valid residential or general contractor license. There are four basic categories of licenses:
1. A residential-basic contractor works on detached one-family and two-family residences and one-family townhouses that are not over three stories in height.
2. A residential-light commercial contractor is a contractor whose work or activity is related to multifamily and multiuse light commercial buildings and structures.
3. A general contractor is a contractor whose work or activity is unlimited in scope regarding any residential or commercial projects.
4. A limited tier general contractor can undertake any residential or commercial projects but is subject to a $500,000 limit per contract. Building inspectors and other authorities who are responsible for issuing building permits are prohibited from issuing a building permit for construction work requiring a licensed contractor unless the applicant for the permit has furnished a valid residential contractor or general contractor license number.
How do I find out if my contractor has a state license?
To find out if a contractor is licensed, go to the Georgia Secretary of State’s website by clicking HERE.
Is a local county or city business license the same as a state contractor license?
No. Some contractors advertise they are “licensed”. Do not assume the word “license” refers to a state contractor’s license. All contractors, whether state licensed or not, are required in most local county or city jurisdictions to have a local license such as a business license required for tax purposes. That local license does NOT mean they hold a state contractor’s license or that they may lawfully perform the work that a state licensed contractor may perform. You should always ask any contractor who claims to have a license for a copy of that license or the licensing information and should verify that license with the issuing authority. If the project requires a state license, You can confirm your contractor holds the required state licensed online. You can check with your county or city government to make sure your contractor has the proper local licensing. You can report someone operating without the required state or local license to the proper authority.
What is a "specialty contractor" and do specialty contractors need a state contractor's license?
Specialty contractors engage in a specific trade, such as finish carpenters, masons and framers. Specialty contractors do not have to hold a license as a residential or general contractor if they are performing work within their specialty. Specialty contractors are also permitted to perform limited work which would otherwise require a license, when the overall project is predominantly within their specialty, there is incidental work related to the overall project and when the work outside their specialty is limited. Specialty contractors must still comply with any state or local requirements for their specialty trade. Specialty contractors include trades licensed by the state (such as electricians and plumbers) and unlicensed trades. Some specialty contractors may be required to hold a local license. A list of specialty contractors who are exempt from the state licensing requirements and the scope of specialty activity that can be performed by each specialty contractor can be found at the Residential and General Contractors Licensing Board website by clicking HERE.
Do I need a contractor's license to build my own home?
No. Property owners may construct a building or structure which is for their own use. It may not be intended for use by the general public. It may not be intended to be offered for sale or lease. A property owner, acting as their own contractor, must personally provide direct supervision and management of all work not performed by licensed contractors. The property owner may not delegate this responsibility to any other person unless that person is properly licensed for that work. If the property owner sells or transfers the building or structure, the property owner will not be allowed to build another structure for a period of two years, unless the property owner obtains a license or hires someone who is licensed to oversee the construction. You must still obtain all required permits, inspections and certificates and You are responsible for failures to comply with appropriate building codes. A property owner may use this exception to the licensing requirement for another structure only once every 2 years.
If an unlicensed contractor asks you to pull a building permit as property owner for a project, you are, in fact, becoming a contractor and may be helping the unlicensed contractor evade state licensing laws. You may be jeopardizing legal protections in the law designed to protect you as a consumer. Specialty contractors do not need you to pull permits for them as they are not required to have a state contractor’s license. If a contractor asks you to pull a building permit, you should consult your legal advisor.
Do I need a licensed contractor to perform basic home repairs?
No, so long as the repairs do not affect the structural integrity of the building. The term “repair” generally means to fix, mend, maintain, replace or restore a part or portions of real property. Examples of repairs that do not require a licensed contractor include work such as painting, replacing carpets, adding new cabinets, or patching walls and are not limited by any dollar amount. However, structural work such as removing and replacing walls would require a licensed contractor if the total value of the work or the compensation to be received by the contractor exceeds $2,500.00. If an unlicensed contactor is hired to make non-structural repairs, the contractor may not delegate or engage to supervise, manage or oversee anyone other than their own employees.
ANY STATUTES, RULES OR POLICIES CITED HEREIN ARE NOT INTENDED TO BE AN EXHAUSTIVE LISTING OF INFORMATION ON THE SPECIFIC ISSUES RAISED, AND SHOULD NOT BE TREATED AS SUCH. THE INFORMATION SET FORTH ABOVE IS PROVIDED FOR GENERAL INFORMATIONAL PURPOSES ONLY AND DOES NOT REPRESENT A LEGAL OPINION. AN ATTORNEY MUST REVIEW THIS INFORMATION TO DETERMINE HOW IT APPLIES TO A PARTICULAR SITUATION. CONSUMERS ARE URGED TO CONTACT THEIR LOCAL PERMITTING OFFICE AND/OR THE RESIDENTIAL AND GENERAL CONTRACTORS LICENSING BOARD FOR ADDITIONAL INFORMATION CONCERNING THE APPLICATION OF THE LICENSING LAW IN A PARTICULAR SITUATION.