Minnesota contractor license requirements

Licenses and registrations

Residential Building Contractor (BC)

Contractors who contract directly with a homeowner for work in more than one special skill area on residential real estate (1-4 family buildings, including detached garages), including new construction. Also owners who build or improve homes for resale or speculation.

• When it applies: Contractors whose gross annual receipts from residential activities are less than $15,000 may be exempt with a Certificate of Exemption.
• Good to know: Covers all remodeler work plus new construction. The qualifying person takes the qualifying builder (QB) exam.

Residential Remodeler (CR)

Contractors who contract directly with a homeowner for work in more than one special skill area on existing residential structures only.

• When it applies: Same $15,000 gross annual receipts exemption with a Certificate of Exemption.
• Good to know: The eight special skills are excavation, masonry/concrete, carpentry, interior finishing, exterior finishing, drywall and plaster, roofing, and general installation specialties. Specialty contractors who provide only one special skill do not need a state license (except roofers). The qualifying person takes the qualifying remodeler (QC) exam.

Residential Roofer (RR)

Roofers working on residential real estate, even if roofing is the only skill offered.

• Good to know: The qualifying person takes the qualifying roofer (QR) exam.

Contractor Registration

Subcontractors who do not contract with the homeowner, and commercial contractors.

• Good to know: These contractors do not need a residential license but must register with DLI.

What you need to qualify

• Exams: Each license must name one qualifying person (an owner, officer, member, partner, chief manager or managing employee) who passes the DLI pre-license exam before the license application is submitted.
• Insurance: Liability insurance of at least $100,000 per occurrence, $300,000 aggregate and $25,000 property damage, covering premises, operations and products, and completed operations, with DLI listed as certificate holder. Proof of workers' compensation on a DLI-approved form.
• Bond: No bond is required for licensing; the Contractor Recovery Fund replaces bonding requirements. A surety bond of at least $40,000 is required to reinstate a license after a recovery fund payout.
• Financial: Applicants disclose bankruptcy history, civil judgments and certain criminal convictions on a background disclosure form.
• Business registration: The business must have an active filing with the Minnesota Secretary of State, and the exact filed name must be used everywhere. A license cannot be obtained or renewed without an active filing.
• Also required: The license number must appear on business cards, contracts, lien notices, advertising and websites.

Fees, renewal and continuing education

• Fees: New license: $180 license fee plus a Contractor Recovery Fund fee of $320 (gross annual receipts under $1 million), $420 ($1-5 million) or $520 (over $5 million). Renewal: $505 (under $1 million), $605 ($1-5 million) or $705 (over $5 million). $90 late fee if the renewal is not received by the expiration date.
• Renewal: Business licenses run on a two-year cycle ending March 31 (odd or even years). Qualifying person registrations are good for two years and may have a different expiration date.
• Continuing education: The qualifying person must complete 14 hours of DLI-approved CE every two years, including at least one hour on the Minnesota Energy Code and one hour on business management strategies. If the Q registration has been inactive more than two years, the exam must be retaken.

Contracts and homeowner protections

Agreements between a licensee and a customer must be in writing and include a detailed summary of the services, a description of materials or standard features, and the total price or how it is calculated. The licensee must give the customer written performance guidelines before signing, and all agreements must be signed and dated by both parties (Minn. Stat. 326B.809). The Contractor Recovery Fund can pay homeowners up to $100,000 per claimant, and up to $550,000 total per licensee, for out-of-pocket losses caused by a licensed contractor; a court judgment is required.

Electrical, plumbing and HVAC work

DLI's Construction Codes and Licensing Division licenses electricians, electrical contractors, plumbers and plumbing contractors. Businesses doing gas, heating, ventilation, cooling, air conditioning, fuel burning or refrigeration work must file a $25,000 mechanical contractor bond with DLI.

City and county rules

Building permits are issued locally. After a license expires, municipalities cannot issue building permits to contractors whose renewals have not been processed and approved.

Working without a license

Performing building contractor or remodeler work without a license is a misdemeanor. An unlicensed person who knowingly violates the law has no right to a lien, and any lien is void. Administrative and civil penalties can also apply.

What to confirm with the state

We couldn't confirm these on an official page when we checked. Ask the licensing office before you rely on them:

• Exam fee
• Experience requirement (none found on the pages we checked)
• Specific fine amounts for unlicensed residential contracting
• Statewide HVAC individual licensing (only the $25,000 mechanical contractor bond was confirmed)

Sources

1. Residential contractors, remodelers, roofers (DLI)
2. Who needs a license? (DLI)
3. Contractor and remodeler license (DLI)
4. Residential contractor licensing (DLI)
5. Contractor, remodeler license renewals (DLI)
6. Residential contractor FAQs (DLI)
7. Fact Sheet: Contractor Recovery Fund (DLI)
8. Minn. Stat. 326B.83 (license application)
9. Minn. Stat. 326B.809 (written contracts)
10. Mechanical contractor bond requirements (DLI)
11. Construction Codes and Licensing (DLI)