Getting a general contractor license in Delaware is a must for any professional in the construction industry. Whether you’re a general contractor, electrician, plumber, or specialized tradesman, the licensing process can be overwhelming. This guide will break down the licensing requirements in a simple step-by-step process, including insurance, bonding, and who to contact in Delaware. By following the steps and state regulations, you can ensure your business is legal and professional.

Licensing Authorities in Delaware

For contractor licenses, you can reach out to the Delaware Division of Revenue. The Delaware Department of Revenue and the Delaware Department of Labor are key authorities in this process. Here’s the contact information:

Delaware Division of Revenue

Web: Delaware Division of Revenue

Alternate Phone Number: 512-463-6599 (For calls outside Texas)

Phone: (302) 577-8200

Alternate Phone Number: 512-463-6599 (For calls outside Texas)

Address:
Main Office: Carvel State Office Building, 820 N French St. W., DE 19801

Contractor Licensing Process

Business Registration

Before you apply for a contractor license, your business must be registered with the Delaware Division of Revenue. The Combined Registration Application is a streamlined process for registering various licenses. Sole proprietorships, LLCs, partnerships, and corporations also need a business license. Obtaining a Federal Employer Identification Number (FEIN) is necessary before proceeding with state-specific requirements.

Determine License Type

Delaware has two types of contractor licenses:

Resident Contractor License: For businesses based in Delaware.
Non-Resident Contractor License: For contractors whose businesses are based outside of Delaware but work in the state.

Get Business License

Once your business is registered, you can apply for a general business license online through the Delaware One Stop website.

Submit Contractor Application

You can download the contractor license application from the Delaware Division of Revenue’s website or apply online. Make sure all required documents, including insurance, are included.

License Renewal

Contractor licenses in Delaware are valid for one year, so it must be renewed annually to maintain your status as a licensed contractor.

Insurance and Bonding Requirements

General Liability

Delaware requires contractors to have general liability insurance. This covers property damage, bodily injury and personal injury claims that may occur on a project. Minimum coverage is $300,000. In New Castle County, contractors must also ensure they have proper liability insurance to meet specific licensing requirements for utility and building permits.

Workers’ Comp

If you have employees, Delaware law requires you to have workers’ comp to cover medical expenses and lost wages from work related injuries. Even sole proprietors may be required to have this insurance if hiring subcontractors.

See the Official Document:

Surety Bonds

Not always required, but for larger projects or public works contracts. This bond ensures contractors meet their contractual obligations. Bond amounts vary by project but can start at $10,000 or more.

Insurance Costs

General Liability Insurance: $500–$2,500 per year, depending on coverage.
Workers’ Comp Insurance: $2,000–$8,000 per year, based on payroll and risk.
General Contractor License: Required for contractors who perform general construction, remodeling, or repair work valued at $50,000 or more.
Surety Bonds: 1%–5% of bond amount.

Special Considerations for Non-Resident Contractor License in Delaware

Non-Resident Contractor License: Contractors not based in Delaware but working within the state must register for a Non-Resident Contractor License. Construction contractors must register their businesses with the appropriate authorities and file Delaware state income tax returns.
State-Specific Taxes: Contractors must comply with Delaware’s Gross Receipts Tax, which applies to revenue generated from services provided within the state. Additionally, obtaining a Delaware business license is necessary, and contractors must follow the steps involved in the Combined Registration Application process. Contractors should also be aware of the Delaware contractor license and the specific processes managed by the Delaware Division of Revenue. Each local municipality has its own licensing requirements that may differ. The Delaware Division of Professional Regulation oversees various specialty trade licenses, exams, and the application process for general contractors and subcontractors.

Navigating the licensing and insurance process can be complex. Obtaining a Delaware contractor license is a crucial step in this process, as it outlines the necessary steps, required credentials, and specific licensing procedures managed by the Delaware Division of Revenue. For assistance in securing the necessary insurance coverage, visit Contractors Liability to get quotes.

Frequently Asked Questions (FAQ)

These are common questions about General Contractor License in Delaware

Yes, all contractors, whether general or specialty, need a valid contractor’s license to work in Delaware. Non-resident contractors must also register for a Non-Resident Contractor License.

To become a licensed contractor in Delaware, you must submit an application to the Delaware Division of Revenue, provide necessary documentation (such as proof of insurance), and pay the required fees. Specialty contractors, such as those in plumbing or electrical work, may also need additional licenses and must meet specific prerequisites.

All contractors are required to carry general liability insurance. If you have employees, you must also have workers’ compensation insurance. Specific bonding requirements may apply to certain projects.

Yes, non-resident contractors must file Delaware state income tax returns for any income earned from work performed within the state.

Delaware imposes a Gross Receipts Tax on contractors, which applies to the revenue generated from services provided in the state. The tax is calculated on gross earnings without deductions for labor, materials, or other business expenses.

Although there may not be a state-mandated exam for general contractors, specialty contractors such as electricians or plumbers may need to pass trade-specific exams to qualify for their license.