How to Get an Illinois Contractor License

Do You Need an Illinois General Contractor License?

At the state level, only plumbers and roofers need to be licensed. General contractors, electricians, and other trades do not have to carry an Illinois-issued license.

Getting a “stamp of approval” is good practice and the law. Most cities and counties in Illinois require contractors to carry licenses before they can do work, but it depends on where you live. If you’re unsure, check with your local municipal department first.

So you want to obey the law. But, there are a lot of other good reasons to get a license too. Here are a few:

• You’ll score jobs that pay more. Chances are, you can handle smaller projects, like painting trims, installing appliances, and caulking bathrooms. But a license opens the doors to bigger, more complicated jobs… and higher pay.

• You’ll appear credible and professional. Getting a license is a great way for new customers to find you. You’ll appear in online lists with other licensed contractors. And, your license will make you appear trustworthy, safe, and credible.

• You’ll protect your business in big ways. What would you do if your equipment got damaged or if an employee got injured? Fortunately, most licenses require you to get business insurance, like general liability insurance and workers compensation. These plans protect you if there’s an unexpected loss, plus they can help prove to licensing boards that you have the necessary paperwork in place to get your contractor license.

Does a Handyman Need an Illinois Contractor License?

Much like general contractors, handymen don’t need a state license to work in Illinois. Instead, municipalities often have laws that may require handymen to have a general contractor license.

It’s a good idea to check with the local government agencies in the city, town, or area you’ll be working in.

Does a Contractor Need a Business License?

While general contractors do not need an Illinois contractor license from the state, they do need to register their business with the state.

There are two types of registrations you should be aware of:

An Illinois Business Authorization, also called a Certificate of Registration, allows you to do business in the state. Every business needs this stamp of approval to conduct business and pay taxes.

An Illinois Business License is an occupation-specific permit that helps the state ensure you’re qualified to perform a skill. Many businesses will need a license, but not all.

You can get more details from the state’s First Stop Business Information Center. You also can call their hotline at 800-252-2923 or email them at [email protected].

For more information on registering your business in Illinois, check out this helpful guide.

How do I Get an Illinois General Contractor License?

It’s not as overwhelming as you might think. For some licenses, you’ll go to the Illinois Department of Public Health. But, for the majority of contractor’s licenses, you’ll head to your local municipal department.

We’ll break it down for you.

General Requirements for Illinois Contractor License

Head over to the Illinois Department of Public Health if you’re a contractor who works with:

• Irrigation
• Plumbing
• Removal of asbestos
• Removal of lead

They can help you secure your license. For everyone else, start the licensing process by:

• Registering with the Illinois Secretary of State if your business is a partnership, LLC, LLP, or corporation.
• Registering with the Illinois Department of Revenue to get one or more tax-specific numbers, licenses, or permits.
• Getting worker’s compensation and other business insurance to protect your employees.

Then, you’ll go to your local department to get an Illinois contractor’s license there. We can’t break down the process for every city and county in Illinois. But, since it’s the biggest city in the state, we’ll talk about how licensing works in Chicago.

Getting a Contractor’s License in Chicago

If you live and work in the Windy City, you can get your Illinois business license through the City of Chicago Business Affairs and Consumer Protection Department. It’s a fairly simple process, but it does take some time.

Next, apply for your contractor’s license with the City of Chicago Department of Buildings. In your application, you need to include:

• A completed application form.
• A description of the work you plan to do.
• Information about your business and its structure.
• Proof that you’re financially stable.
• Proof you have business insurance.
• The type of license classification you’re applying for. Chicago offers:
  • Class A license: no limitation to the value for any single project
  • Class B license: not allowed to work on projects that are more than $10,000,000
  • Class C license: not allowed to work on projects that are more than $5,000,000
  • Class D license: not allowed to work on projects that are more than $2,000,000
  • Class E license: not allowed to work on projects that are more than $500,000
• A licensing fee for your particular license classification.

The City of Chicago Department of Buildings also offers additional licenses for contractors who manage electrical work, plumbing, masonry, cranes, and private alarms. If you have questions about what licenses you need, call 1-800-359-1313 or email [email protected].

Illinois Business Insurance: What You Need to Know

Remember how we said that you may be required to carry business insurance in order to get your contractor license?

That’s why we recommend getting your business insurance policy first before applying for your contractor license. Buying a top-notch insurance plan is one of the first steps toward becoming official, plus you’ll have your Certificate of Insurance (COI) ready to go during your application process..

When it comes to insurance policies you should consider, we recommend general liability insurance and workers compensation (only if you have employees). General liability insurance and workers compensation can protect you, your employees, and your property, like vehicles and equipment, in the event of a loss or injury. Plus, it can make you appear professional and official in the eyes of your customers.

Ready to Get to Work?

Licenses, registrations, and insurance are key steps to setting up your contractor business, but they’re often just the start. We want you to know that we’re with you every step of the way. That’s why we created our online small business resource center, Simply U.

It’s got helpful information about nearly every aspect of starting and running a successful business. And we’re adding new information every month.

OK, time to get busy.