Wondering what steps to take to start your general contracting or handyman business in Washington? We’ve got you covered.
The idea of starting your own business comes with a whole host of emotions. You’re excited about the possibilities, proud you’re finally taking the step, and likely overwhelmed or confused about the legal side of things. Never fear, Simply Business is here. We’ve scoured the Washington State Department of Labor and Industries website to bring you a simple, how-to guide for becoming a general contractor in Washington.
Why Do I Need a Washington Contractor’s License?
If you’ve ever taken an exam and paid a fee to get a driver’s license, then the Washington contractor’s license process won’t be completely foreign.
Business licenses make sure that contractors in the state are knowledgeable and reputable. Licensure requires passing an exam and sometimes has experience standards as well.
On the other hand, business registration doesn’t have experience or exam requirements. It’s simply a way for the state to keep track of whose operating a business so that contractors can be held responsible for their actions (or inaction).
Business insurance protects the business owner and their personal assets. Even with precautions, property damage or bodily injury can happen on a job site. Having general liability insurance prevents you from having to pay those damages out of pocket, and it’s also required by the state.
If you decide to skip a few steps and start operating a business without the required license, registration, or insurance, you could be in for fines or charges. After receiving your license or registration from the state of Washington, you’ll be listed on their database of contractors for potential customers to use.
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How to Become a General Contractor in Washington
Being organized makes the registration and licensure process much more manageable. Let’s break down how to become a general contractor in Washington into small steps.
General contractors vs. specialties
Every state handles contractor licensing differently, and in Washington, general contractors don’t need to apply for a license. Instead, general contractors are required to register. If, however, you’ll be working on the specialty skills listed below, you’ll need to pass an exam.
If you’re a general contractor, you only need to register. General contracting covers:
- Repairing buildings
We’ll go over registration requirements and process in a moment.
If you’re a specialty contractor, you must meet education and exam standards to become licensed. There are 63 specialties and project types that you may need to be licensed to perform. The main license categories that have education and exam steps are:
If you have any questions about whether the work you’re planning on doing requires licensure or not, contact your local L&I office or the Contractor Information line at 1-800-647-0982. For this guide, we’ll be focusing on general contractor registration.
What you need before registering
The registration application itself is straightforward, but you do need to take care of a few things before applying. Here’s what you need to send in along with your registration application:
- Business registration. Your first step is to decide on a business structure, such as a corporation or sole proprietorship. If you set up a sole proprietorship, you’ll need to decide on a name. If you choose to set up an LLC or corporation, contact the Secretary of State.
- SSN or FEIN. If you’re a sole proprietor, you’ll use your social security number for tac identification. If you set up a business entity, you’ll include your Federal Employer Identification Number.
- Surety bond. General contractors need to secure a $12,000 surety bond before registering. This ensures you’re able to pay damages for uncompleted work.
- General liability insurance. Washington has your best interest in mind by requiring general liability insurance. You’ll need coverage for $200,000 in public liability and $50,000 property damage, or $250,000 combined single limit.
- Business and mailing address. Your business must have a listed non-P.O. Box address, but your mailing address can be a P.O. Box.
- Previous registration info. If you, your spouse, or any principal owners in your business have ever been a registered contractor, you have to tell the state. They’ll ask for past business names and registration numbers.
- Worker’s compensation insurance. If you have or will have employees, you need worker’s compensation insurance. Washington also refers to it as “industrial insurance”.
Sign and notarize your application
You’re in the home stretch of getting your Washington general contractor registration. After gathering your documents, you need to fill out an application and have it notarized. You can either have the application notarized separately, or visit your local L&I office to fill out the forms and apply in person.
Submit your application
If you don’t submit your forms in person at the L&I office, you’ll mail your application, supporting documents, and a check, money order, or cash payment of $117.90 to:
P.O. BOX 44450
Olympia, WA 98504-4450
Renew your license every year
You’ll need to keep your general contractor registration up to date by renewing every year. If none of your business information has changed, including your bond or insurance, you can simply renew online or via mail. Any changes to your business or coverage will need to be documented, and the renewal fee is $117.90.
If you still have some Washington contractor’s license questions unanswered, check out the state’s Labor and Industries website.
If you still need to get general liability and worker’s comp insurance before you can apply, get a contractor’s insurance quote to ensure you’re covered. We also have a guide on How to Start a Handyman Business.
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