Getting your Tennessee license starts here...
Getting a Tennessee contractor license is required before bidding or performing work over the state thresholds. The Tennessee contractor licensing process is managed by the Board for Licensing Contractors, which reviews financial statements, surety bonds, or guaranty agreements to set each license’s monetary limit. Contractors may qualify as a general contractor, or under specific categories such as Limited Licensed Electrician (LLE), Limited Licensed Plumber (LLP), and Home Improvement (HI).
Most applicants must submit a reviewed or audited CPA statement, but a Tennessee contractor bond can also be used to supplement financial responsibility. Contractors may be eligible for reciprocity with states such as Alabama, Georgia, North Carolina, South Carolina, and others to waive the trade exam, but all applicants must still pass Tennessee’s Business & Law exam.
Contractor Licensing Inc. helps you navigate every step of the Tennessee contractor license process—from financial documents and bonding to reciprocity applications—so you can get approved faster and stay compliant.
Tennessee Contractor Licensing
In Tennessee, the Board for Licensing Contractors regulates commercial and residential contractors, along with limited licenses for electrical (LLE), plumbing (LLP), and home improvement (HI). Licenses are issued to entities (sole proprietor, partnership, LLC, or corporation) and tied to a monetary limit, determined by audited or reviewed CPA financial statements, or supplemented by indemnities such as a Guaranty Agreement, Contractor’s License Bond, or a Line of Credit.
Monetary Limits
- Based on 10x working capital or net worth (whichever is less).
- Unlimited licenses require minimum $300,000 in both working capital & net worth.
- Reviewed CPA financials required up to $3M; audited required above $3M.
- Indemnities (Guaranty Agreement or Bond) can supplement financial statements up to 50% value.
Contractor’s License Bond
If financials cannot support the requested limit, a Contractor’s License Bond may be filed:
- $500,000 bond for limits under $3M
- $1,000,000 bond for limits above $3M
- Must be written in exact Board form, signed, notarized, and backed by an AM Best–rated surety.
Other Licensing Categories
- LLE (Limited Licensed Electrician): For projects under $25,000.
- LLP (Limited Licensed Plumber): For plumbing projects under $25,000.
- HI (Home Improvement License): Required for remodeling projects between $3,000–$25,000 in certain counties.
Licenses are valid for two years. Guaranty Agreements expire at renewal and must be resubmitted if used to support limits. Contractors must remain compliant with financial responsibility rules under Rule 0680-01-.13.
Official Links
RECIPROCAL STATES
Tennessee Reciprocity & Exam Waivers
Tennessee maintains reciprocity with several states for trade exams, primarily in electrical, mechanical, and building categories. Applicants using reciprocity may receive a waiver of the trade exam but must still meet Tennessee’s financial, bonding, and Business & Law exam requirements.
- Reciprocity agreements with: Alabama, Arkansas, Georgia, Louisiana, Mississippi, North Carolina, Ohio, South Carolina, and others.
- Only technical exams may be waived; Business & Law exam is always required.
- Applicants must provide a license verification from the reciprocating state board.
Let us know how we can help!
FREE CONSULTATION
FREE CONSULTATION