In the State of Georgia, contractor licensing is governed by State Licensing Board for Residential and General Contractors. Getting your Georgia contractor’s license is an involved process, but it’s worth it. That’s because a contractor license is necessary, and there can be serious consequences for contracting without a valid license.
Of course, certain specialty trades or work costing less than $2,500 might not require licensure. But that doesn’t mean you should just assume you don’t need one. It’s a good idea to play it on the safe side when it comes to licensing.
Let’s take a closer look at contractor license requirements in the State of Georgia.
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Georgia Contractor’s License: Basic Classifications
Georgia has 4 main classifications for contractor licenses that could apply based on the work performed. It shouldn’t be too hard to determine which one you fall under:
- Residential-Basic Contractor: These contractors work on 1 and 2-family residences, plus single family townhouses that are under 3 stories tall.
- Residential-Light Commercial Contractor: These contractors do all of the same work that’s included in the Residential Basic license, plus they can perform work related to multifamily and multi-use light commercial buildings and structures.
- General Contractor: These services are pretty much unlimited regarding the type of work performed, bid, or agreed upon.
- General Contractor Limited Tier: This is the same as General Contractor above, though they’re limited to contract amounts under $500,000.
There are a few core requirements that you’ll need to apply for a Georgia contractor’s license, regardless of the category. The basic requirements to file for a Georgia contractor’s license are:
- Be 21+ years old
- Pass a criminal background check to show that you have good moral character
- Pass a written exam
- Submit an application
- Pay the $200 application fee (it’s non-refundable)
These are just the basic requirements. Each category of license may carry additional requirements.
What About Insurance?
Insurance is something a lot of contractors may not consider initially, but it’s very important. When applying for a contractor license in the state of Georgia, individuals must show proof of general liability insurance. The amount varies based on the license classification. For example, contractors must show proof of general liability insurance with the following minimums (per occurrence):
- Residential-Basic Contractor: $300,000
- Residential Light Commercial Contractor: $500,000
- General Contractor: $500,000
- General Contractor Limited Tier: $500,000
While obtaining a license appears like a bit a work, it’s worth it. Georgia prohibits anyone from performing residential or general contracting without a valid license. While penalties are not specifically laid out, consequences can be steep. Where licensing is required and an unlicensed contractor has agreed to provide work – the contract is “unenforceable in law or in equity.”
What does that mean? It means that, if you don’t have the proper license for work you’re performing, you have no legal right to enforce the contract. If the owner decides not to pay you, you won’t be able to file a lawsuit, a mechanics lien, or anything else to force payment under the contract. Further, you’ll also be unable to obtain the necessary building permits without a valid license, which will cause even more issues down the road.
Bottom line: You can end up losing a lot more by contracting without a license than it likely wouldn’t costed you to obtain one.