Tennessee Contractor License Requirements: Complete 2026 Guide

Tennessee requires a state contractor license before you can bid on, offer a price for, or contract on any project valued at $25,000 or more. The Tennessee Board for Licensing Contractors, part of the Tennessee Department of Commerce and Insurance (TDCI), administers the licensing program and regulates contractors, home improvement contractors, limited licensed electricians, and limited licensed plumbers.

The $25,000 threshold applies to prime contractors, construction managers, and subcontractors performing electrical, mechanical, plumbing, HVAC, and roofing work. Masonry subcontractors must be licensed when their portion reaches $100,000 or more. Beyond state licensing, contractors must also obtain a business tax license for each city or county where they plan to operate and comply with local permit and inspection requirements.

This guide covers every aspect of the Tennessee contractor licensing process: license classifications, experience and exam requirements, the application process, fees, insurance, renewal, reciprocity, and penalties for unlicensed work.

Types of Contractor Licenses

Tennessee uses a single licensing board rather than separate boards by trade. The board issues contractor licenses across multiple classifications for projects of $25,000 or more. Projects below that threshold may fall under Home Improvement, Limited Licensed Electrician (LLE), or Limited Licensed Plumber (LLP) licensing rules.

Building Contractor (BC) Classifications

• BC-A (Residential) — Residential building construction. A limited residential route (BC-A/r) allows applicants to qualify through an approved Tennessee community college or vocational school course instead of the trade exam and Business and Law exam.
• BC-A,b(sm) (Small Commercial) — Small commercial building construction.
• BC-B (Commercial) — Commercial building construction.
• BC-C (Industrial) — Industrial building construction.
• BC (Combined) — Combined building contractor classification covering residential, commercial, and industrial.
• BC-B,C (Commercial/Industrial) — Combined commercial and industrial building construction.

Electrical Contractor (CE)

The CE classification covers electrical contracting work on projects of $25,000 or more. Electrical subcontractors whose portion of the project meets the $25,000 threshold must also hold this license.

Mechanical Contractor (CMC) Classifications

• CMC (Full Mechanical) — Full mechanical contracting including plumbing, HVAC, and related systems.
• CMC-A (Plumbing) — Plumbing contracting. Requires board pre-approval before taking the exam.
• CMC-C (HVAC) — Heating, ventilation, and air conditioning contracting.
• CMC-D (Fire Sprinkler) — Fire sprinkler system contracting.

Other Classifications

• LMC (Licensed Masonry Contractor) — Masonry work. Subcontractors need a license when their masonry portion is $100,000 or more.
• Roofing — Roofing contractors must be licensed when the project meets the $25,000 threshold.
• Highways — Highway and road construction.
• Environmental — Environmental contracting work.
• Heavy Construction — Heavy civil construction projects.
• Municipal Utility — Municipal utility construction.
• Specialties — Various specialty trade categories.

Some specialty work may also require licensing or registration from separate state agencies, including the Alarm Systems Contracting Board, the Division of Fire Prevention (fire sprinklers), and TDEC (geothermal systems). Check the board's business resources page for additional requirements that may apply to your trade.

Licensing Requirements

Experience

The application requires a statement of experience listing the applicant's and qualifying officers' construction experience, along with at least one reference from a past client, employer, or code official. The board uses experience along with financial qualifications to determine the contractor's monetary limit. Verify with the board whether your specific classification has a minimum experience threshold.

Education

There is no general prelicense education requirement for standard contractor licenses. The one exception is the BC-A/r (limited residential) route, which allows applicants to complete an approved course through a Tennessee community college or vocational school in place of the BC-A trade exam and Business and Law exam.

Financial Statement

Every applicant must submit a financial statement prepared in the exact legal name and mode of operation to be licensed. The statement must be less than 12 months old and follow GAAP.

• Reviewed financial statement — Required for monetary limits of $3,000,000 or less.
• Audited financial statement — Required for monetary limits over $3,000,000.

Monetary Limits

Your monetary limit — the maximum value of a single project you can take on — is generally calculated as 10 times the lesser of your working capital or net worth, combined with your experience. An unlimited monetary limit requires at least $300,000 in both working capital and net worth, plus required experience.

A line of credit may supplement working capital only. If your financial statement is deficient, the board may require a Guaranty Agreement or allow a bond in lieu of guaranty in the amount of $500,000 (or $1,000,000 for unlimited limits).

Entity Registration

Corporations and LLCs must register with the Tennessee Secretary of State. DBAs must appear on the Secretary of State certificate and all submitted forms.

Criminal History

Applicants who disclose felony convictions must provide a written explanation, court records, proof of release from probation, a character reference, and TBI/state criminal history reports. The board does not currently require a universal fingerprint or background check for all applicants, but verify with the board whether this has changed.

Application Process

Tennessee contractor license applications are processed through the CORE online portal at core.tn.gov. You can also download the initial application packet (PDF) and find additional resources on the board's forms page. The board's processing goal is 30 days, though deficient applications take longer. License issuance typically takes 4 to 6 weeks.

1. Pass Required Exams: Schedule and pass the Tennessee Business and Law exam and any required trade exam through PSI Services. Exam scores are generally accepted by the board for two years.
2. Prepare Your Financial Statement: Obtain a reviewed (limits up to $3M) or audited (limits over $3M) financial statement dated within the last 12 months.
3. Gather Required Documents: Assemble your exam scores, financial statement, reference letter, certificate of insurance, statement of experience/management, contractor's affidavit, and entity registration documents (if applicable).
4. Submit the Application: Apply online at core.tn.gov or submit the paper application. The initial application fee is $250.
5. Board Review: Applications are processed in the order received. There are no board-meeting deadlines — the board reviews applications on a rolling basis. The initial application open period is 6 months.
6. Informal Interview (if needed): The board may require an informal interview for incomplete applications or certain disclosures. Interviews typically last no longer than 30 minutes.
7. License Issuance: Once approved, your license is issued with the appropriate classifications and monetary limit.

You can check license status through the public access portal. For help with the online application, see the online application resource guide (PDF).

Examination Requirements

PSI Services, LLC administers all Tennessee contractor exams. New applicants must pass the Tennessee Business and Law exam and, for most classifications, a trade-specific exam.

Tennessee Business and Law Exam

This exam is required for all new contractor applicants. It covers Tennessee contractor law, business practices, and regulations. The exam fee is $55.

Trade-Specific Exams

Trade exams are required for most classifications. Each exam costs $55. The available trade exams are:

• BC-A — Residential
• BC-A,b(sm) — Small Commercial
• BC-B — Commercial
• BC-C — Industrial
• BC — Combined Building
• BC-B,C — Commercial/Industrial
• CE — Electrical
• CMC — Full Mechanical (requires board pre-approval; $50 pre-approval fee)
• CMC-A — Plumbing (requires board pre-approval; $50 pre-approval fee)
• CMC-C — HVAC
• CMC-D — Fire Sprinkler
• LMC — Licensed Masonry Contractor

Pre-Approval for Plumbing and Full Mechanical

The CMC-A (Plumbing) and CMC (Full Mechanical) exams require board pre-approval before you can register with PSI. Submit a pre-approval request along with the $50 fee.

Exam Details

• Results: Scores are given immediately after completing the exam.
• Validity: Exam scores are generally accepted by the board for two years.
• Passing score: Verify the passing score cutoff in the PSI candidate bulletin linked from the board's exam information page.

License Fees and Costs

All fees are published on the board's fee schedule.

Application and License Fees

Exam Fees (Paid to PSI)

Estimated Total Cost for a New License

For a typical applicant, approximate out-of-pocket costs include:

• Initial application fee: $250
• Business and Law exam: $55
• Trade exam: $55 (plus $50 pre-approval if plumbing or full mechanical)
• Financial statement preparation: Varies (CPA-prepared reviewed or audited statement)
• Insurance premiums: Varies by coverage level and classification
• Minimum licensing costs: ~$360+ (not including financial statement preparation, insurance, or bond costs)

Insurance and Bond Requirements

General Liability Insurance

Tennessee requires general liability insurance minimums based on the contractor's monetary limit:

A certificate of insurance must be submitted with your application and at each renewal.

Workers' Compensation Insurance

Workers' compensation insurance is required unless the applicant provides proof of exemption. Proof of coverage or exemption must be submitted with your initial application and at each renewal.

Bond in Lieu of Guaranty

If your financial statement does not meet the board's requirements, you may be required to provide a Guaranty Agreement or a bond in lieu of guaranty. Bond amounts are:

• $500,000 for standard monetary limits
• $1,000,000 for unlimited monetary limits

Bond forms are available on the board's forms page.

License Renewal

Tennessee contractor licenses are issued for two years and expire on the last day of the month in which the license was originally issued. The board recommends submitting renewal applications at least 30 days before expiration.

Renewal Requirements

To renew, you must submit the following through the CORE online portal:

• Financial statement (reviewed or audited, depending on monetary limit)
• General liability insurance certificate
• Workers' compensation proof or exemption
• Active Secretary of State status (for corporations and LLCs)
• Renewal fee: $200

Continuing Education

Continuing education is required only for contractors holding BC-A, BC-A/r, or BC-A,b(sm) classifications who were first licensed after January 1, 2009. These contractors must complete 8 hours of board-approved Residential Continuing Education (RCE) each renewal cycle.

The 8 hours can be completed in the classroom, online, or through membership in a board-approved professional trade organization. One qualifying agent can satisfy the requirement for a business with multiple residential qualifying agents. A list of approved RCE providers is available on the board's RCE page.

Late Renewal and Reinstatement

Late renewals incur a penalty of $20 per month, up to 12 months. A license that has been expired for 12 months cannot be renewed and requires reinstatement using the initial contractor application (with the $250 reinstatement fee). Verify current grace period and reinstatement rules directly with the board, as official sources are not fully consistent on timing details.

Retirement Status

Contractors who are not actively working can place their license in retirement status for $25 per year, with a $200 reset fee every 7 years to maintain retirement status.

Reciprocity with Other States

Tennessee does not allow contractors to operate in the state using another state's license. Reciprocity in Tennessee is limited to a trade exam waiver only — you must still pass the Tennessee Business and Law exam, submit a full application, and meet all other licensing requirements.

Trade Exam Waiver States

The board recognizes trade exam waivers from the following states, with waivers limited to specific classifications:

See the full reciprocity classification chart (PDF) for the complete list of eligible classifications per state.

NASCLA Exams

Tennessee accepts the NASCLA National Commercial exam as a trade exam waiver. The board may also accept the NASCLA National Electrical exam, though official sources are not fully aligned on this point. Verify current NASCLA acceptance directly with the board.

How to Verify a Contractor's License

The Tennessee Board for Licensing Contractors provides a free online license verification tool. This is essential for homeowners hiring a contractor and for general contractors verifying subcontractor credentials.

License Lookup

URL: https://search.cloud.commerce.tn.gov/

You can also access the verification tool from the board's verification page.

Board Contact Information

Penalties for Working Without a License

Contracting or offering to engage in contracting without a license — or without the proper classification or monetary limit — violates T.C.A. § 62-6-120. Tennessee treats this as a serious offense with both criminal and civil consequences.

Criminal Penalties

Unlicensed contracting is a Class A misdemeanor in Tennessee, carrying a maximum penalty of:

• Up to 11 months and 29 days imprisonment
• A fine of up to $2,500

The board's rules also establish citation penalties for unlicensed contracting under Rule 0680-01-.21 ranging from $50 to $1,000.

Additional Consequences

• Ineligible to be awarded the project — An unlicensed contractor cannot receive a contract award.
• Removal from the project — The contractor may be removed from work already in progress.
• Six-month licensing ban — An unlicensed contractor cannot receive a license for six months after a violation.
• No re-bidding — The violating contractor cannot participate in re-bidding for the same project.
• Limited recovery in court — Under T.C.A. § 62-6-103, an unlicensed contractor may be limited to recovering only actual documented expenses rather than the full contract price.
• No lien rights — Unlicensed contractors do not have lien rights in Tennessee.

Filing a Complaint

Consumers can file complaints with the board for unfair or deceptive business practices, unlicensed activity, or suspected misconduct. Note that the board cannot provide legal advice or represent individuals seeking refunds — its jurisdiction is limited to license discipline.

Frequently Asked Questions

What is the licensing threshold in Tennessee?

A state contractor license is required for any project valued at $25,000 or more. This applies to prime contractors, construction managers, and subcontractors in electrical, mechanical, plumbing, HVAC, and roofing. Masonry subcontractors must be licensed when their portion reaches $100,000 or more. Projects below $25,000 may require a Home Improvement, LLE, or LLP license instead.

How long does it take to get a Tennessee contractor license?

The board's processing goal is 30 days from receipt of a complete application, though deficient applications take longer. The board's public licensing page says license issuance typically takes 4 to 6 weeks. Applications are processed in the order received on a rolling basis — there are no board-meeting deadlines.

Do I need continuing education to renew my license?

Only if you hold a BC-A, BC-A/r, or BC-A,b(sm) classification and were first licensed after January 1, 2009. Those contractors must complete 8 hours of board-approved Residential Continuing Education (RCE) each renewal cycle. All other classifications have no CE requirement.

Can I use my license from another state to work in Tennessee?

No. Tennessee does not allow you to operate on another state's license. However, if you hold a license in Alabama, Arkansas, Georgia, Louisiana, Mississippi, North Carolina, Ohio, South Carolina, or West Virginia, you may qualify for a trade exam waiver for specific classifications. You must still pass the Tennessee Business and Law exam and submit a full application.

What financial documents do I need?

You need a GAAP-compliant financial statement dated within the last 12 months. A reviewed statement is required for monetary limits up to $3,000,000. An audited statement is required for limits over $3,000,000. The statement must be in the exact legal name and mode of operation to be licensed.

What happens if my license expires?

Late renewals incur a $20 per month penalty for up to 12 months. After 12 months of expiration, the license cannot be renewed — you must apply for reinstatement using the initial contractor application and paying the $250 reinstatement fee. You may not perform any contracting work while your license is expired.

Conclusion

Obtaining a Tennessee contractor license requires passing the Business and Law exam (and typically a trade exam), submitting a GAAP-compliant financial statement, providing proof of insurance, and demonstrating relevant construction experience. The process is straightforward if you gather your documentation early and submit a complete application.

Start your application at core.tn.gov or download forms from the board's forms page. For questions, contact the Tennessee Board for Licensing Contractors at (615) 741-8307, toll-free at (800) 544-7693, or by email at Contractors.Home-Improvement@tn.gov.

This article is provided for informational purposes and was last updated in April 2026. Licensing requirements, fees, and regulations are subject to change. Always verify current requirements directly with the Tennessee Board for Licensing Contractors.