Starting A Contractor Business in PA

According to Pennsylvania's Home Improvement Consumer Protection Act (HICPA), a home improvement project includes but isn't limited to the installment, replacement, repair, remodeling or construction of the land attached to a private residence. If you intend to start a contractor's business in Pennsylvania and earn more than $5,000 a year providing these types of home improvement services, your need to get registered with the state.

Suggestions

1. Decide on a specialty. As a home improvement contractor you can specialize in the types of projects you want to work on. For instance, you may choose bathrooms, kitchens, attic renovation, flooring and so on. According to "Starting a Business as a Remodeling Contractor" on the Entrepreneur website, green remodeling could be a popular niche for contractors. This would involve using nontoxic building material and making homes more energy efficient.
2. Register your business with the state of Pennsylvania. You may register as a sole proprietorship, a partnership, a limited liability corporation or a corporation. A tax or business professional will be able to help you determine the best business status depending on your situation. Once you're ready to register, you can do so through the Online Business Registration Interview webpage.
3. Obtain insurance. Before you can file your contractor's registration you'll need at least $50,000 in property damage coverage and another $50,000 in personal injury liability coverage. You'll be able to find insurance agents through any major search engine like Google or Bing.
4. File a home improvement contractor registration. You may obtain a registration form by calling (717) 772-2425. Once you receive the form you'll need to include information about your business structure and any previous contractor's licenses you've held, along with a description of your new business, information on previous bankruptcies or criminal convictions, and proof of insurance. As of June 2011, an application fee of $50 was required with your registration.
5. Include your contractor's number in all advertisements, estimates, proposals and contracts. Although there's no rule dictating where you have to put this number, it must be prominently showcased in your customer documents, once you receive it.

Tip

• Failure to register your contracting business in Pennsylvania could result in civil penalties of $1,000 or more.

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