Contractor Licensing Requirements in Tennessee

Tennessee runs a real, threshold-based licensing system through the Board for Licensing Contractors (TBLC). Whether you need a state license depends on how big your jobs are and what trade you’re in — some trades need one at any dollar amount. Here’s the breakdown.

Tennessee’s Contractor Licensing System

The Tennessee Board for Licensing Contractors, under the Department of Commerce and Insurance, requires a license for any project valued at $25,000 or more. That threshold drops to $3,000 for masonry, and electrical, mechanical, plumbing, HVAC, and roofing contractors need a license at any project value. Tennessee is a NASCLA-participating state, so its Commercial General Building license accepts the NASCLA exam in place of a state trade exam.

License Classes in Tennessee

• BC-A (Building Construction, Commercial) — commercial general contracting
• BC-B (Building Construction, Residential) — residential general contracting
• Specialty/trade classifications — electrical, mechanical, plumbing, HVAC, roofing, masonry, and more, each with its own classification code
• Home Improvement Contractor (HIC) registration — for residential jobs between $3,000 and $25,000 that fall under the threshold for full BC licensure

Exam & Experience Requirements

Applicants must pass both a trade exam and the Business and Law exam, each administered by PSI, with a 73% passing score required. Tennessee also imposes a financial responsibility test: contractors need working capital and equity equal to at least 10 times the monetary limit they’re requesting on their license, backed by a CPA-prepared financial statement (a CPA Review or Audit for new applicants, compiled statements accepted at renewal).

NASCLA Reciprocity

Tennessee accepts the NASCLA Accredited Examination for Commercial General Building Contractors in place of its own trade exam, though the Business and Law exam and financial requirements still apply.

Bonding & Insurance to Get Licensed

Tennessee doesn’t require a flat bond amount for every contractor — the Board sets a bond case-by-case if your financial statement shows a deficiency against your requested monetary limit. General liability and workers’ comp coverage (mandatory once you have employees) are expected as part of operating legally, though the Board’s core financial test is the net worth requirement, not an insurance minimum.

For exact GL and workers’ comp dollar minimums required to get licensed, see Insurance Minimums to Get Licensed.

Reciprocity with Other States

Beyond NASCLA exam acceptance, Tennessee doesn’t offer blanket license-for-license reciprocity with other states — out-of-state contractors still have to meet the same exam, financial, and application requirements as in-state applicants.

Tennessee Licensing Fees & Timeline

Penalties for Unlicensed Contracting

Contracting above the $25,000 threshold (or in a licensed trade at any amount) without a TBLC license is a Class B misdemeanor under Tennessee law and can bar a contractor from enforcing payment on a construction contract in court.

Resources: TN Board for Licensing Contractors, TBLC Classification Outline (PDF)

Frequently Asked Questions

Licensing rules, fees, and thresholds change; verify current requirements directly with the Tennessee Board for Licensing Contractors before applying.