Arizona Contractor License Question

Can you sell your contractors license? Many contractors spend a lifetime building a successful business and when retirement looks likely they want to profit from their hard work by selling the company. Does the law limit who can buy it? Could you sell yours? At the other end of the spectrum, an aspiring contractor who can hardly wait to get started has our first four questions

Q: I’ve just completed the Business and Trade Exam in Arizona. I now want to apply for my license; however, I have job offers for both California and Arizona. Can I be licensed in Arizona and still perform contracted work out in California? How much does it cost for a California Contractors License? How much does it cost for an Arizona Contractors License? Finally, how long will it take to get our license in each State?

A: Congratulations on passing the law and trade exams. To apply for your license, the State of Arizona requires completion of a comprehensive application including securing a Transaction Privilege Tax (TPT) Number from the Dept. of Revenue. Securing a separate California license is required in order to work in this State. It does not matter where else you are licensed or where your business is based.

Costs to obtain an AZ license should be around $700.00m (for a specialty class). Fees for a CA license are $400 (plus fingerprint expenses). If applying as a corporation, there will be added costs.

It is taking approximately 3 months to obtain a license in CA and about 2 months in AZ. However, this can vary widely depending on a number of factors including testing (in CA) fingerprinting (in CA); applying as a corporation in AZ and CA; or obtaining your TPT in AZ. A contractors bond is required in each state.

Q: Can I sell my roofing business to someone who doesnt have a license? Can my license number go to them? Is this as simple as filing a change of owner with the State? Please help me.

A: Thank you for the email. There are no contractors licensing rules or regulations that dictate who you can sell your business to. So if you want to sell it to someone who does not have a license this is up to you. This being said, since active contractor licenses must have a qualifying individual, the new owner will need to find someone who can qualify for the roofing classification. This might be an employee who is staying with the company after it’s sold or if the new owner has 4 or more years of experience, that individual can apply to qualify for the new license.

You do not say whether the license is a sole owner, partnership or corporation. In most cases, the existing license number cannot be transferred to the buyer. For instance, a sole owner cannot transfer his or her license number (unless it is being taken over by a family member); partnerships cannot transfer a license since changing a partnership will most always cause the existing number to be cancelled; and corporation numbers may only do so if the company is selling its stock (rather than just the assets) to the new owners.