Nevada contractor’s licenses are governed by the Nevada State Contractor’s Board (NSCB). Applying for a license can seem like an expensive and daunting task, but performing unlicensed construction work can lead to some serious consequences. This article will provide you with everything you need to know about applying for a Nevada contractors license.
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Who needs a contractor’s license?
Anyone (individual or business) who’s involved in the construction, or alteration of any building, highway, road, parking facility, railroad, excavation, or other structure in Nevada must be licensed to do so if the contract value is $1000 or more. There are some exceptions, contracts valued under $1K may still require a license in some scenarios; such as if a building permit is required, the work involves plumbing, electrical, refrigeration, or HVAC work, to mention a few.
Furthermore, the state of Nevada doesn’t recognize out-of-state contractor licenses. Just follow these steps, and you’ll be well on your way to getting your Nevada contractor license.
Nevada contractor licensing process
Step 1. Get a business license
The first step in getting. contractor’s license is to start a business and get a business license. This can be done online at the Nevada Secretary of State website. No one can conduct business in the state of Nevada without first obtaining a business license. This is a relatively straightforward process, and the website will give you step-by-step guidance on how to accomplish this. As for fees, setting up an LLC, for example, will set you back about $500.
Step 2. Submit a license application
Now that you are licensed to conduct business within the state, the next step is the actual license application itself. However, before filling out the application, you must determine what type of license you actually want. For contractors, there are three different license classifications that are available:
- General Engineering Contractor: Class A
- General Building Contractor: Class B
- Specialty Contractor: Class C
You can check out the full description of each classification on the NSCB website.
Once you’ve determined which type of license you want to apply for, it’s time to fill out the application itself. If you need any assistance filling out the application form, the Board does offer a free business assistance program monthly at the Reno and Henderson offices. The application must be submitted along with a $300 non-refundable application fee. The application itself can be found here: Nevada State Contractors Board License Application.
Required work experience
In order to be eligible for a contractor’s license, the applicant must have at least 4 years of experience in the classification being applied. All 4 years must have occurred within the last 10 years preceding the application. To prove experience, the application requires a detailed resume of experience and includes 4 certificates of work experience. These reference certificates must be filled out by someone (other than the applicant) who has first-hand knowledge of the work experience. Also, college or university training may satisfy a portion of the required experience.
After the application is submitted, you’ll receive instructions on how to get a full criminal background check. This requires getting your fingerprints taken and submitting them to a full FBI criminal background check. Also, you’ll need to fill out the Background Disclosure Statement. This should be done as honestly as possible. A conviction won’t necessarily preclude you from getting licensed, but lying about it might.
Good financial standing
Lastly, the applicant must prove that they are in good financial standing to obtain a contractor’s license. This is achieved by submitting a financial statement along with the application. The type of financial statement required depends on the monetary limit you request in the application. The monetary limit is the maximum contract price the prospective contractor is willing to take on for a single client. Depending on the amount you choose, the financial statement must either be reviewed and audited or fully prepared by a certified public accountant.
Step 3. Pass the licensing exams
When your application is reviewed and accepted, you’ll receive a letter informing you of your eligibility to sit for the exams. Nevada contractors are required to pass two of them. The first being a business and law exam and a trade exam based on whichever specialty the license is for. The exam fees are $140 if both exams are taken at the same time or $95 for each individual exam. Contractor exams are administered by PSI, Inc., and all fees will be paid directly to them.
Exams can be taken in either Reno, Las Vegas, or Elko. The results of the exam are available immediately afterward. If you didn’t pass the exam, then you’ll have to wait two weeks before trying again. If, after three tries, you still can’t pass the exams, the application will be voided; and you’ll have to wait 30 days to submit a new one.
Step 4. Final requirements
After passing the exam, there are a few last things that you’ll need to do to have your license granted. Of course, there’s another fee. The final fee is $600 and the license will last 2 years until it needs to get renewed.
In addition to the license fee, all new Nevada contractor’s licenses require the posting of a bond. This can be done using a surety bond or making a cash deposit. The amount required ranges from $1,000 to $500,000 depending on the type of license, monetary limit, financial standing, and experience. Also, if you have or plan to hire any employees, worker’s compensation insurance is also required.
Lastly, for residential contractors, you’ll be required to pay into the Residential Recovery Fund. The amount will be based on the monetary limit of the applied-for license.
Penalties for unlicensed contracting
The state of Nevada takes unlicensed contracting very seriously, violations of these requirements can lead to administrative penalties from the NCSB and criminal penalties as well. The contractor board can impose a fine for each violation, and which can be $1,000 to $50,000 depending on the situation. In addition, the board can impose investigation costs and any damages caused as a result of the violation.
Unlicensed contracting is a crime, plain and simple. For a first offense, an individual can be charged with a misdemeanor. This includes a fine that ranges from $1,000 to $4,000 and time in the county jail for up to 6 months. As for a second offense, this is a gross misdemeanor. If found guilty, this comes with a fine of $4,000 to $10,000, and as long as 364 days in county jail. Lastly, a third offense is a category E felony! The contractor could end up spending up to 4 years in state prison and be fined anywhere from $10,000 to $20,000.
As you can see, the state of Nevada takes contractor licensing very seriously! Don’t get caught without one.