How to Become a Contractor in North Carolina – NC Contractor License

For those working in construction, becoming a contractor gives you the freedom to bid on, contract, and oversee large projects in your realm of expertise. Contractors in the First in Flight State can enjoy a starting salary of around $80,000, which is quite comfortable considering that NC’s cost of living is 10% lower than the national average.

To work as a contractor in NC, you’ll need to apply for either a Building Contractor, Residential Contractor, Highway Contractor, Public Utilities Contractor, or Specialty Contractor License with the state. NC also offers separate electrical and plumbing contractor licenses.

Do You Need a Contractor License in North Carolina?

North Carolina requires all contractors to be licensed in their classification. Anyone who manages or performs the construction of any building, highway, public utilities, grading, or improvements to a structure that is valued at over $30,000, or anyone who builds a new structure according to NC code is considered to be a contractor (page 6). Licenses are issued by the NC Licensing Board for General Contractors.

The exception to this law is anyone constructing on their own land or farm who intends to solely live and/or use that building after completion.

Types of NC Contractor Licenses

Below are the 5 classifications of NC contractors and their definitions.

  • Building contractors can work on construction and demolition for commercial, industrial, institutional, and residential areas.
  • Residential contractors work on the construction and demolition of residential units.
  • Highway contractors work on grading, paving, installing surfaces, relocating utility lines, bridge construction, parking decks, curbs, gutters, storm drainage, etc. 
  • Public utilities contractors work on water and wastewater systems and their subclassifications, such as Boring & Tunneling, Communications, Fuel Distribution, Electrical-Ahead of Point Delivery, Water Lines and Sewer Lines, Purification and Sewage Disposal, and Swimming Pools.
  • Specialty contractors cover contract work for Grading and Excavating, Boring and Tunneling, Communication, Concrete Construction, Electrical-Ahead of Point Delivery, Fuel Distribution, Water Lines and Sewer Lines, Water Purification and Sewage Disposal, Insulation, Interior Construction, Marine Construction, Masonry Construction, Railroad Construction, Roofing, Metal Erection, Swimming Pools, Asbestos, and Wind Turbines.

License Limitations

In addition to license classifications, NC also has license limitations. These limitations determine the size of the projects you can do, and they are selected depending on your finances. 

  • Limited contractor licenses allow you to work on any project valued at $500,000 or less. 
    • You will need personal assets exceeding your liabilities by $17,000+ OR 
    • Total net worth of $80,000+ OR
    • A $175,000 surety bond*
  • Intermediate contractor licenses allow you to work on projects valued at up to $1 million. 
    • You will need personal assets exceeding your liabilities by $75,000+ OR
    • A $500,000 surety bond*
  • Unlimited contractor licenses allow you to work on projects of any value.
    • You will need assets exceeding your liabilities by $150,000 OR
    • A $1,000,000 surety bond*

*All surety bonds must be obtained from a company that is rated Superior (A++ or A+) or Excellent (A or A-) by A.M. Best or a successor rating organization.

License limitations can change over time. For example, you can begin on a limited-level license and then apply for an Increase in Limitation once you meet the financial requirements.

Getting Your NC Contractor License 

NC contractor licenses can be granted to individuals or businesses, but the name on the license must be for work done by that entity alone. 

To get your NC contractor license, you’ll need to:

  • Be 18+
  • Have a good moral character
  • Complete the application
    • Provide proof of financial responsibility meeting all requirements for your license limitation
    • Include the Agreed-Upon Procedures Report that is filled out by your CPA or independent accountant instead of an audited statement
  • Pay all fees
  • Pass a PSI exam in your contractor classification

First, you’ll complete the Application for License to Practice General Contracting in the State of North Carolina online. Click on “Create Account” under New Users to begin your application. 

Once your application is completed and submitted, it will take about two weeks to process. Once processed, you’ll receive information via mail about how to schedule your exam. 

A PSI exam for your classification must be taken by the Qualifying Party or “Qualifier”. The Qualifier must be listed on the application and will be the responsible individual for all projects. Once you’ve scheduled, taken, and passed your exam, you will receive your license 2-3 weeks later.

Alternatively, if you’re applying to be a building contractor, you may take the NASCLA National Accredited Building Examination before applying for your license. 

There are no individual insurance requirements for licensing, although certain projects or building permits may request them once you’re licensed. Worker’s Compensation is not required for the license application, but it is required as per North Carolina state laws.

Renewing Your License

Contractor licenses can be renewed online. The Qualifier must take 8 hours of Continuing Education (CE) from an approved provider to renew a building, residential, or unclassified license. Two of these hours will be through a mandatory course by the board about code changes. The CE year runs from January 1 to November 30th.

Electrical and Plumbing Contractor Licenses

Electrical and plumbing contractors are regulated separately in North Carolina. Most applicants will first need to apply for the examination, pay all fees, and then receive the license once the exam has been passed.

Electrical contractors must apply for licensure through the NC State Board of Examiners of Electrical Contractors. All application forms can be found here.

Plumbing, heating, fuel piping, and fire sprinkler contractors are overseen by the NC State Board of Examiners of Plumbing, Heating, and Fire Sprinkler Contractors. All forms can be found here.

Contractor Salaries in North Carolina

The general salary for contractors based in NC depends on their classification, license limitation, experience, and city of work. Unlimited building and residential contractors tend to be paid on the higher end of the spectrum, while limited licenses are on the lower end.  

Some of the top-paying NC cities for contractor work are listed here:

  • Charlotte, NC: $122,600
  • Greensboro, NC: $107,600
  • Wilmington, NC: $102,600

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