To start a construction company in Florida, you form the business (usually an LLC, for $125 on Sunbiz), get a state contractor license through the Construction Industry Licensing Board, and carry the insurance that license requires. The license is the long pole. It takes years of verifiable experience and two exams, so plan around it, not around the LLC paperwork.
Working without a license is a criminal offense in Florida. Don’t take a paying job before the license is in hand.
Should a Florida construction company be an LLC or a corporation?
Most Florida contractors form an LLC. It keeps your home and savings out of reach if the company is sued, it’s taxed as a pass-through by default, and you can elect S corporation status later if the tax math works. Banks, suppliers and clients also take an LLC more seriously than a sole proprietorship.
| Feature | LLC | Corporation |
|---|---|---|
| Personal liability protection | Yes | Yes |
| Pass-through taxation (default) | Yes | No (must elect S corp) |
| Formality requirements | Minimal | Annual meetings, minutes required |
| Ownership flexibility | Unlimited members, flexible allocation | Stock-based, more rigid |
Some large construction companies use corporations. If you’re starting small and plan to grow, we’d go with an LLC.
How do you set up the construction LLC?
- Pick a name. It has to be unique in Florida and include “LLC” or “Limited Liability Company.” Check it on the Florida Division of Corporations (Sunbiz) site. Pick something easy to spell that doesn’t sound like a contractor already working your area.
- File Articles of Organization. It’s $125 online. You’ll list the name, principal business address, registered agent with a Florida address, and members or managers. Online filings take 2-3 business days.
- Write an operating agreement. Cover ownership percentages, profit distributions, who manages what, what happens if a partner leaves or dies, and how big decisions get made. You’ll want it when you apply for the contractor license and the bank account.
- Get an EIN. It’s free at irs.gov, and you need it to open business accounts, hire employees and file taxes.
How do you get a Florida contractor license?
The Construction Industry Licensing Board (CILB) issues two kinds of license. A certified contractor can work anywhere in Florida. A registered contractor can work only in the specific counties that issue their own licenses, registers with the state and takes local exams. If you want to grow, get certified.
Which license category do you need?
Division I covers general, building and residential contractors. Division II covers the specialty trades: roofing, sheet metal, air conditioning (Class A, B or C), mechanical, pool/spa, plumbing, underground utility, solar, pollutant storage, specialty structure, and glass and glazing.
What are the requirements?
Experience. General, building and residential contractors each need 4 years of experience. Specialty trades vary. The experience has to be verifiable and can come from work as a foreman, supervisor or contractor.
Two exams. One is Business and Finance (accounting, business law, contracts). The other is the trade exam for your category. Exam fees are approximately $79 per exam.
The application. Submit the DBPR CILB 1 application and pay the fee ($249-$399 depending on license type). Include proof of insurance, fingerprints for a background check ($54), a credit report and financial statements.
Finances. Depending on your category and the contract limits you want, you’ll show financial capability through net worth or bonding.
How hard are the exams?
Hard enough that most people who pass take a prep course (typically $500-$1,500), study for 3-6 months, and use practice exams to find weak spots. The trade exam is open-book, so bring the correct reference materials. The business exam tests accounting, lien law, contract law and OSHA requirements.
We’d start studying while you’re still logging the last of your experience years. Exam prep takes months, and the LLC takes only days.
What insurance does a Florida contractor need?
Two policies are required to get and keep the license.
General liability. The minimum is $300,000 per occurrence for residential contractors, with higher minimums for general and building contractors. It covers bodily injury and property damage on job sites.
Workers’ compensation. In construction, it’s required once you have one or more employees. Up to 3 corporate officers can claim an exemption. Sole proprietors may exempt themselves, but they should still carry coverage. Florida actively enforces this in construction. Penalties include stop-work orders, fines of $1,000 per day, and criminal charges for repeat violations.
Beyond the required policies, most contractors add commercial auto for company vehicles, builder’s risk for structures under construction (fire, storms, theft, vandalism), professional liability if you do design or specification work, and an umbrella policy.
| Coverage | Typical annual cost |
|---|---|
| General liability (new contractors) | $2,000-$5,000 |
| Workers’ compensation | Varies by trade and payroll (construction rates are high) |
| Commercial auto | $1,500-$3,000 per vehicle |
Rates come down as you build a claims-free history.
What local licenses and permits apply?
Most Florida counties and cities require a local business tax receipt (formerly called an occupational license). You get it from your county or city tax collector, and fees range from $30-$500 depending on location.
Some counties also want you to register your state license locally, sometimes called a certificate of competency, before you work there. Expect to show your state license and proof of insurance and pay a registration fee. Every individual job then needs a building permit from the local building department, which you pull as the contractor. Permit fees vary with project size and complexity.
What registrations come after the license?
DBPR. Your license is tied to your business entity. If you formed an LLC, the license must be “qualified” under it. That means submitting form DBPR CILB 5 (Business Information), giving the LLC’s EIN, and listing all qualifying agents and business partners.
Florida Department of Revenue. Register at floridarevenue.com for sales tax (construction labor is generally not taxable, but you collect sales tax on materials you sell separately) and for reemployment tax once you hire employees.
Bank accounts. Open a business checking account in the LLC’s name with your EIN confirmation letter, Articles of Organization, operating agreement and ID. Keep business and personal money apart. Commingling can wipe out your liability protection if someone sues the company. A savings account for tax reserves, a line of credit for project financing and a business credit card are worth setting up too.
Why does construction accounting need its own setup?
Because you’re tracking money per job, not just per month. Job costing, progress billing, retainage and work-in-progress accounting don’t fit a generic bookkeeping setup. Construction-specific software helps: QuickBooks for Contractors, Foundation Software, Buildertrend or CoConstruct. Bring in a CPA who knows construction early, to set up job costing, manage cash flow, handle quarterly tax payments and prepare year-end returns.
Know your costs before you bid, or you’ll lose money on the jobs you win. Construction also has long payment cycles, so plan your cash flow around them.
What does it cost to start a construction company in Florida?
| Expense | Estimated cost |
|---|---|
| LLC formation (state fee) | $125 |
| Exam prep course | $500-$1,500 |
| Exam fees (2 exams) | $158 |
| License application | $249-$399 |
| Fingerprints/background check | $54 |
| Insurance (annual) | $3,000-$10,000 |
| Business tax receipt | $30-$500 |
| Equipment and tools | $5,000-$50,000+ |
| Initial marketing | $500-$2,000 |
| Total range | $10,000-$65,000+ |
Equipment drives most of that range. Budget working capital on top of it.
What do you have to keep up each year?
License renewal. Florida contractor licenses renew every two years, by August 31 of odd-numbered years. You need 14 hours of continuing education, which must include 1 hour each of workplace safety, business practices, workers’ compensation, the Florida Building Code (advanced course), and laws and rules. Renewal also takes a fee ($209-$305 depending on license type) and current proof of insurance.
Annual report. File the LLC’s annual report with the Division of Corporations by May 1 each year. It’s $138.75.
Insurance. Keep it current at all times. A lapse can get your license suspended, and a gap in workers’ comp can shut the business down immediately.
Use a written contract on every job, covering scope, timeline and payment terms. Skipping contracts is one of the most common mistakes new contractors make.
Get the business side done while you study
IncCraft forms your Florida construction LLC, gets your EIN and provides registered agent service. Get that finished early, so when your license comes through, the entity it’ll be qualified under is already in place.