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State contractor startup guide

How to Start a Contracting Business in Texas

Use this Texas guide to identify the responsible licensing agency, put business setup tasks in a workable order, and reach the official state pages for registration, taxes, permits, and employer accounts. Sources were reviewed on .

Texas startup snapshot

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Includes

  • An ordered first-pass path for the TDLR credential, bond, and insurance questions that apply to your trade
  • Business-entity and tax-account sequencing based on your answers
  • Workers' compensation guidance for solo owners and employers
  • A prompt to check your exact job location before you bid
  • Official Texas source links on every step

Does not include

  • Business name development or domain availability check
  • Confirmation of exactly which filings and tax accounts apply to your situation
  • Contract, deposit, and consumer-notice templates
  • Google Business Profile, website, or marketing setup
  • Pricing tools, chart of accounts, or the Contractor Vault library

The free check identifies where to start. The paid roadmap walks you through every decision from choosing your business name to becoming ready for your first paid job.

Free Texas roadmap ready: Answer five questions to turn the reviewed Texas business, licensing, bond, insurance, worker, renewal, and local-permit requirements into your ordered first pass.
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Answer five questions. Get your Texas startup path.

This free first pass uses the reviewed Texas requirements to organize business registration, the credential track you select, bond and insurance checks, workers compensation, renewal, and local permits.

1. Where are you with the business entity?
2. Which work track best matches the business?
3. What is the worker plan?
4. Are bond and liability requirements handled?
5. Have you checked the first job location?

Your assessment is not complete yet

The five-question check above gives you an ordered first pass for Texas. It does not resolve:

  • Your exact work scope
  • Whether you need a single credential or multiple credentials
  • Business name and domain availability
  • Exactly which filings apply to your situation
  • Which tax accounts you need to open
  • Workers' compensation and employer registration
  • Contracts and required consumer notices
  • Local, first-job requirements for your exact project location
  • What has to be done before you can advertise, bid, or accept payment
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Texas contractor license requirements, at a glance

Texas has no statewide general contractor license and no general statewide business license. Whether you need a state license depends entirely on your trade: TDLR licenses electricians and air conditioning/refrigeration (HVAC) contractors, and the separate Texas State Board of Plumbing Examiners licenses plumbers. General construction, remodeling, roofing, concrete, and most other trades carry no state license, but cities and counties impose their own registration, permit, and bond rules, so the requirement moves to the local level rather than disappearing. Start with the Texas Department of Licensing and Regulation (TDLR). Confirm the exact credential for your trade, project size, and location before bidding.

Full Texas licensing detail, local jurisdictions, and official sources

Licensing, bond, and insurance details

RequirementDetailSource
Trade license (no statewide GC license)Varies by trade because there is no single state license. Example: a TSBPE Master Plumber pays a $25 exam processing fee, $128.50 to Pearson VUE on exam day, and a $75 initial license fee (plus $39.05 IdentoGO fingerprinting). Confirm current amounts with the board that covers your trade.TDLR
Pre-license training & examTrade-specific. Plumbing and electrical run apprenticeship hours plus a proctored exam through their own boards; there is no statewide pre-license course for general construction because there is no statewide general license.TDLR
Surety bondTexas imposes no universal state bond on an unlicensed general contractor, and TSBPE’s ordinary RMP designation requires commercial liability insurance rather than a statewide plumbing-license bond. A city, public work, right-of-way permit, owner, performance contract, or another licensed specialty can impose a separate bond, so the operator must check the work address and project documents.Tex. source
General liability insuranceTexas has no universal statewide general-liability minimum for ordinary general or handyman work. A Responsible Master Plumber must continuously maintain at least $300,000 commercial general-liability insurance and keep the certificate on file with TSBPE. Municipal contractor registration, property owners, general contractors, and contracts can require higher limits or additional automobile and umbrella coverage.Tex. source

Construction lien deadlines (Texas)

Texas deadlines are state-specific. They are NOT the same as other states:
1. Residential: record the lien affidavit by the 15th day of the third month after the month the work was completed, terminated, or abandoned. Texas lien deadlines run from when labor or materials were actually furnished, not from your invoice date. statute
2. Residential: a derivative claimant (subcontractor or supplier) must serve the notice of unpaid claim by the 15th day of the second month after the month the labor or materials were furnished. Missing that notice invalidates the lien. Texas notice rules are among the strictest in the country and differ between residential and commercial work — read Chapter 53 or get counsel before relying on a summary. statute

Lien deadlines are strict and unforgiving and depend on your role; confirm every deadline with a Texas construction attorney before you rely on it.

Taxes

Texas has no personal income tax but does levy sales and use tax, and contractors owe it differently depending on whether a job is lump-sum or separated-contract, and whether the work is new construction or repair/remodeling. Most contractors need a Texas Sales and Use Tax Permit from the Comptroller. Texas also has a franchise tax with a no-tax-due revenue threshold that most new one-person shops fall under, though the report can still be required.

Contractor licensing sources

These are the state pages used for the licensing summary and verified figures above. The weekly Contractor Lane source checker watches every URL for moves or outages:

Which Texas cities will you be working in?

Texas issues no statewide general-contractor license. General construction, remodeling and most trades answer to city and county rules instead, while electrical and HVAC are licensed by TDLR and plumbing by TSBPE statewide.

A TDLR or TSBPE trade license is statewide, but it is not general-contractor authority and it does not by itself let you pull a permit in a given city.

Registering in one jurisdiction never creates authority in the next one. Every city and county is resolved separately, by the exact project address. Crossing a boundary can mean starting over.

Local paperwork is not one thing. These four are separate, and holding one does not give you the others:

  • Contractor authorityPermission to hold yourself out and contract for the covered work at all. In these 14 states that permission is granted locally, not by the state.
  • Local business licensePermission to operate a business inside that city or county. Separate from contractor authority: having one does not grant the other.
  • Tax endorsement or accountA local tax registration or endorsement on a business license. It is a tax obligation, not permission to build.
  • Permit accountAn account with the building department that lets you actually pull permits. A city can recognize your credential and still refuse a permit until this account exists.
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Contractor Lane does not publish a municipal fee, bond, insurance minimum, threshold or exam requirement unless it has been read off that jurisdiction's own current published material and reviewed. Where the status above says an official page only, or not researched, that work has not been done and we will not guess at it. Confirm every local requirement with the jurisdiction before you bid.

How to start a contracting business in Texas

To start a contracting business in Texas, set up your business entity, register for the state tax accounts that apply to your work, confirm the contractor credential your trade requires with Texas Department of Licensing and Regulation, and clear local permits before you hire or bid. Use the ordered steps below as a planning path and open each official Texas link to confirm what applies to your entity, trade, project size, and job location.

  1. Choose the business structure

    Compare the entity options available in Texas before you file. Your structure affects registration, taxes, ownership records, and the documents a licensing agency may request.

    Open the official Texas Governor start a business

  2. Register the business

    Use the official Texas filing system to form or register the entity and confirm whether a separate business name filing is needed.

    Open the official Texas Secretary of State business startup information

  3. Set up state tax accounts

    Check the state revenue agency for business tax registration, sales or marketplace tax rules, withholding, and any industry-specific accounts that apply to your work.

    Open the official Texas Comptroller franchise tax

  4. Confirm the contractor credential

    Start with Texas Department of Licensing and Regulation. Match the license, registration, classification, or local requirement to the exact trade and scope you plan to sell.

    Open the official Texas Department of Licensing and Regulation contractor licensing

  5. Check permits and local rules

    State registration does not replace city, county, building-department, or trade-permit rules. Confirm the job address and scope before bidding or starting work.

    Open the official Texas licenses and permits guide

  6. Register before hiring

    If you will have employees, confirm employer registration, withholding, unemployment, workers compensation, and workplace-safety responsibilities with the responsible agencies.

    Open the official Texas Workforce Commission employer resources

Official Texas business and contractor agencies

These government pages cover business formation, taxes, permits, employer setup, and contractor licensing. A source link is an entry point, not proof that every rule applies to every contractor.

What to verify before you bid

Before you bid in Texas, confirm the credential matches the exact work and that your business, tax, and insurance records use the same legal name. A state license or registration does not replace city or county permits, local business licensing, or bond requirements, so verify the job location too.

  1. Match the credential to the work. General building, residential work, electrical, plumbing, HVAC, roofing, public work, and specialty trades can follow different rules.
  2. Check the project location. A state registration never replaces city or county contractor registration, permits, bond requirements, or local business licensing.
  3. Set up the business first when required. Confirm the entity name, tax account, workers' compensation status, and insurance certificate match the name used on the license application and contracts.
  4. Confirm money and deadlines directly. Fees, financial limits, bonds, insurance minimums, renewal dates, notice rules, and lien deadlines are deliberately omitted unless they were checked against the responsible agency or statute.

Free Texas contractor resources

Browse Contractor Lane's complete 86-topic startup floor plus any additional trades identified by Texas official classifications. Open the Texas contractor resource library.

Licensing is only one part of opening the doors. These practical guides cover the next operating decisions:

Common Texas contractor startup questions

Does Texas require a contractor license?

Texas has no statewide general contractor license and no general statewide business license. Whether you need a state license depends entirely on your trade: TDLR licenses electricians and air conditioning/refrigeration (HVAC) contractors, and the separate Texas State Board of Plumbing Examiners licenses plumbers. General construction, remodeling, roofing, concrete, and most other trades carry no state license, but cities and counties impose their own registration, permit, and bond rules, so the requirement moves to the local level rather than disappearing.

Where do I start the contractor application?

Start with Texas Department of Licensing and Regulation (TDLR). Confirm the classification and application path for your exact work before relying on a general summary.

Can a city or county require something separate?

Yes. Local business licensing, contractor registration, trade permits, building permits, and bonding rules can apply even when the state does not issue a general-contractor license. Check the job location before bidding.

Is the free Texas roadmap available?

Yes. Use the free questionnaire on this page to create a first-pass Texas startup roadmap.

Getting the order right matters more than any single number. The free Texas builder above turns your answers into an ordered first pass, then keeps endorsement-specific decisions flagged for official confirmation.

Where Contractor Lane comes in

A list of requirements tells you what Texas asks for. The interactive roadmap puts those requirements in order for your trade and situation, then connects them to banking, payments, Google, pricing, and first-job setup.

General educational information for people starting a contracting business in Texas. Fees, amounts, and deadlines change. Contractor Lane is not a law firm or tax advisor.

About Contractor Lane

Contractor Lane is built and maintained by working home-service operators. We publish the order of operations we wish someone had handed us, sourced to the responsible state agency.

General educational information. Every figure here is sourced to the responsible Texas agency or statute, but fees, amounts, and deadlines change and some depend on facts specific to your business; verify each with the responsible agency before you rely on it. Contractor Lane is not a law firm, CPA, insurance agency, or licensing agency.
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