Maryland General Contractor License: Get Licensed to Work
If you’re looking to get into one of the most lucrative trade industries in the country, getting your Maryland general contractor license is a great bet.
According to the Economic Research Institute, the average salary for Maryland general contractors is $138,000, and that number jumps to nearly $170,000 for the leading contractors in the state.
The Bureau of Labor Statistics projects that the industry will grow by 8% from 2021-2031, and currently, there are only 6,100 contractors employed in the state. There’s no better time than now to get started in this booming space.
In this licensing guide, we’ll go over every critical step in the licensing process.
Do you need a general contractor license in Maryland?
Yes, you need a license to perform general contractor work in Maryland. Unlicensed contracting is illegal in the state.
The type of license you need, and how you get it, will change depending on whether you work on residential or commercial buildings.
The Maryland Home Improvement Commission is in charge of handing out contractor licenses for home improvement through the Maryland Department of Labor’s Division of Occupational and Professional Licensing (DOPL). If you want to work on commercial construction projects, you’ll need to contact the Clerk for the Circuit Court in your corresponding county or Baltimore City. To build new homes in the state of Maryland, you need to register with the Home Builder Registration Unit.
It’s important that you use the right license or registration for your contracting projects. For example, if you work on a home improvement project with only a construction license, you may be subject to fines and even jail time.
Types of contractor licenses in Maryland
The work of a general contractor is split between three different categories in Maryland, two of which require a license and one of which needs registration:
|Home Improvement Contractor License||License holder can add to, alter, convert, improve, modernize, remodel, repair, or replace a building or building segment that is designed to be used as a dwelling with three or fewer units.|
|Construction License||License holder can do work on or in any building or structure that requires the use of building materials like paint, stone, brick, mortar, wood, cement, iron, steel, etc.|
|Home Builder Registration||Registered builders can work on projects that involve the construction of a new residence.|
How do I get a general contractor license in Maryland?
Here are the steps that the DOPL outlines for getting your home improvement contractor license:
- Provide proof of at least two years of experience in home improvement, construction, or relevant education
- Pass the licensing exam with a score of at least 70%
- Demonstrate that you meet the financial solvency requirements based on the project contract and business size
- Submit articles of incorporation and your Certificate of Good Standing (if representing a corporation)
- Provide a certificate of trade name (if necessary)
- Provide a credit report
- Obtain $50,000 in liability insurance
You can submit all home improvement contractor applications and forms online or physically to the following address:
1100 North Eutaw Street
Baltimore, MD 21201
The exact steps for getting your construction license in Maryland will vary depending on which county you are applying to work in. Construction licenses need to be obtained from the Clerk of the Circuit Court for the area in which the project is occurring.
Depending on the area in which you want to build and the type of project, you will also need to get a local permit. Here’s where you can find permit info for Baltimore City.
To become a registered home builder in Maryland, you need to fill out the registration form, pay all associated fees and submit the form to the Home Builder Register Unit of the Maryland Office of the Attorney General.
You can submit all home builder registration applications and forms to the following address:
200 St. Paul Place
Baltimore, MD 21202
Maryland general contractor exam
The only contractor license in Maryland that requires an exam is the home improvement contractor. The test is administered by the state’s testing vendor PSI.
The exam is 55 questions long, covering the topics of laws, regulations, and practical elements of running a home improvement business. You need to get a score of at least 70% (39/55) to qualify for the license.
You can find more information on the home improvement contractor licensing exam in PSI’s candidate information bulletin.
Does Maryland reciprocate general contractor licenses?
Maryland does not reciprocate licenses for home improvement contractors because applicants need to “demonstrate knowledge of Maryland laws and regulations.” This means that even if you are a licensed contractor in another state, you cannot work in Maryland without a Maryland-approved license.
Contractors who want to work on commercial projects in Maryland can apply for an out-of-state contract license that allows them to work in the county where the project is taking place. Once the application is accepted, out-of-state contractors can work on commercial projects anywhere in the state.
How much does a general contractor license cost in Maryland?
To get a license or registration allowing you to perform or oversee construction projects in Maryland, you can expect to pay up to $1,050 initially, depending on the type of buildings you want to work on.
Home Improvement Contractor:
- Exam: $63
- Application: $250
- Processing: $20
- Guaranty Fund Assessment: $100
- Licensing in Cecil County: $30
- Licensing in Baltimore City/County: $40
- All other counties: $15
Registered Home Builder:
- Initial Registration: $800
- Guaranty Fund Assessment: $250
- Renewal: $400 – $1,200
It’s important to remember that there are often insurance requirements for working as a contractor, so make sure you check with the right state or local authority for more information to determine any associated costs.
Renewing your general contractor license
Home improvement contractor licenses are valid for two years, with the deadline for renewal based on the initial application. The Maryland DOL has a dedicated webpage that lets home improvement contractors renew their licenses online. You also need to make a Guaranty Fund payment of $150 every time you renew your license.
Commercial construction licenses in Maryland technically aren’t renewable, and you will need to apply for one on an annual basis, with the specifics of the process changing depending on which county you want to work in. For example, all Cecil County business licenses, including construction, expire on April 30th each year, regardless of when they are obtained.
If you want to renew your home builder registration, you need to do so through the Maryland Office of the Attorney General every two years. The specific amount will vary depending on the number of permits that were issued to you the prior year. Renewal applications are mailed about 60 days before expiration.
What happens if my general contractor license expires?
No matter where you are in Maryland, you should stop all contracting work if your license, registration, permit, or insurance has expired. Otherwise, you open yourself up to fines, penalties, and even legal action.
Contracting without a license is a misdemeanor in Maryland, with the first offense potentially carrying a $1,000 fine and/or up to 30 days in jail. Further offenses can warrant a fine of up to $5,000 and/or two years in jail.
To avoid any issues, make sure you renew all necessary licenses, registrations, and permits and pay any applicable fees.
How to start a contracting business in Maryland
Regardless of the type of contracting work you want to do in Maryland, starting your own contracting business is a great way to earn more money. The state government has a new business checklist to help you get started, including:
- Selecting and creating the legal structure for your business
- Registering your business name with the State Department of Assessments and Taxation (SDAT)
- Learning how to file the required Annual Report
- Paying the annual business personal property tax
To make sure your business is successful, you’ll also want to think about:
- Pricing your services appropriately
- Securing financing and setting up an accounting system
- Finding the necessary equipment and product suppliers
- Setting up general contracting business software
- Creating a sales strategy
- Generating leads for your general contractor business
See our library of free contracting business resources to make sure you’re setting yourself up for success.
Does a general contractor license in Maryland increase your earning potential?
Yes, getting a license or registration to work on home improvement, home building, or commercial construction projects in Maryland definitely increases your earning potential. But this varies depending on where in Maryland you want to work and which type of projects you want to work on.
The average salary for contractors is $138,000 in the state, and that number jumps to nearly $170,000 for the top earners. Remember, there will be some variation in how much you earn between home improvement, home building, and commercial construction projects.