How to Start a General Contractor Business in Washington: L&I Registration, $30,000 Bond and $150.20 Fee, No Exam

If you searched for a general contractor license in Washington, the first thing to know is that the state does not license general contractors. It registers them. The Department of Labor and Industries (L&I) handles contractor registration under RCW 18.27, and the requirements are a registration fee, a surety bond, liability insurance, and an active state business license. There is no state exam, no experience requirement, and no education requirement. You must be 18 or older.

This guide walks through the sequence in the order most new contractors find works best: choosing a business structure, getting your state business license, buying insurance, posting a bond, registering with L&I, and then setting up advertising and customer paperwork. Most of the work is paperwork and money, and the timeline depends mainly on how quickly your insurance and bond quotes come back and how fast the state business license is processed.

What you need before you start

Gather these items before you file anything:

• A business name that meets state rules. An LLC name must include Limited Liability Company, Limited Liability Co., L.L.C., or LLC. It cannot contain words such as bank, trust, or cooperative, and it must be distinguishable from every other business name on record with the Secretary of State.
• A Washington registered agent. Every LLC or corporation must designate and maintain one under RCW 23.95.405. The agent must consent to serve, supply an email address, and have a physical street address in Washington. PO Boxes and private mailbox addresses are not accepted.
• Identifying information. Your full legal name, residential address, Social Security number or federal employer identification number (EIN), and a bank account and credit card for the fees.
• A liability insurance quote. You need $250,000 combined single limit, or $200,000 public liability plus $50,000 property damage, with L&I named as certificate holder.
• A surety bond quote. You need $30,000 for general contractor registration or $15,000 for specialty.
• Any trade names. If you will operate under a name other than your legal name, list each one now.

Step 1: Choose your business structure and file with the Secretary of State

Decide whether you will operate as a sole proprietor or form an entity. Sole proprietors and general partnerships do not file with the Secretary of State, so you can skip this step and move to Step 2. Many contractors form an LLC to separate personal and business liability. An LLC files a Certificate of Formation with Initial Report through the Corporations and Charities Filing System at ccfs.sos.wa.gov. The filing fee is $180. A corporation files Articles of Incorporation with Initial Report for the same $180.

If you need to hold a name while you prepare the paperwork, you can reserve it for 180 days for $30. Expedited service costs $100 per business entity and is generally processed within three business days. The Secretary of State does not publish a standard turnaround for regular online filings, so if your timing matters, pay for expedited service. Check the name against the Secretary of State's business search at ccfs.sos.wa.gov before you file.

This is informational only. An attorney or CPA can help you decide whether an LLC, a corporation, or a sole proprietorship fits your liability and tax situation.

Step 2: Get your UBI and state business license

Washington runs a statewide business license through the Department of Revenue's Business Licensing Service (BLS). One application issues your nine-digit Unified Business Identifier (UBI), registers trade names, and handles any city or state endorsements. If you formed an LLC, corporation, LLP, or partnership, you must file with the Secretary of State first, then submit the Business License Application. Apply at dor.wa.gov/open-business/apply-business-license.

An active business license and UBI are required for L&I registration, so for a contractor this step is not optional. The processing fee to open a business is $50, plus separate endorsement fees. If you later add a trade name to an existing business, the processing fee is $10. Each trade name costs $5 and is registered through the BLS, not the Secretary of State or your county. Online applications take about 10 business days. Add 2 to 3 weeks if city or state endorsements need approval, and expect up to six weeks for a mailed application. Plan your timeline around the slowest step.

Step 3: Buy liability insurance

Ask your insurance agent for a policy that meets the L&I minimum. Either $250,000 combined single limit or $200,000 public liability plus $50,000 property damage will satisfy the requirement. The insurer must issue a certificate that names L&I as certificate holder. Read the certificate after it arrives and confirm that L&I appears exactly as the certificate holder, because a certificate that names the wrong party can delay your registration.

Step 4: Post your surety bond

The bond amount for general contractor registration is $30,000. Since July 1, 2024, the specialty amount is $15,000. Earlier amounts were $12,000 for general and $6,000 for specialty, so disregard any guide that still lists those numbers. A surety bond is not the same as insurance. You do not pay the $30,000 face amount. You pay a premium to a surety company, and the premium depends on your credit and business history. Get at least two or three quotes from surety agents before you commit.

Your bond and insurance must stay in force after registration. If either is canceled, your registration is suspended automatically. The Homeowner Recovery Program can pay homeowners up to $25,000 per parcel, so expect homeowners and cities to ask about your bond. Confirm the details of that program with L&I.

Step 5: Register with L&I

With your UBI, insurance certificate, and bond in hand, register through L&I at lni.wa.gov. The registration fee is $150.20 for two years. If your registration lapses, reinstatement costs $70.90. You must be 18 or older. There is no exam, no experience requirement, and no education requirement.

Do not confuse this with licensing for electricians and plumbers, which involves testing. General contractor registration has no test. If a course or website says you must pass an exam to become a registered general contractor in Washington, it is wrong for this trade.

Step 6: Set up your advertising and customer disclosures

Washington requires your L&I registration number in all advertising. That includes your website, business cards, vehicle signs, yard signs, online directory listings, and social media profiles. Advertising or performing work without registration is a gross misdemeanor. Cities also check the registration number before issuing a permit, so an incomplete or incorrect number can stall a project.

You must also give a written disclosure statement on residential jobs of $1,000 or more. Commercial jobs from $1,000 to $60,000 also require the statement under RCW 18.27.114. Ask L&I for the exact wording and build it into your contract template before your first bid goes out.

Step 7: Plan for state and local taxes

Washington has no corporate income tax, no franchise tax, and no personal income tax on wages. Instead, nearly every business pays the state business and occupation (B&O) tax. This is a gross receipts tax with more than 50 activity classifications, and it does not allow a deduction for labor, materials, or other costs. Many cities also levy their own local B&O tax. About 54 cities add one, and the Department of Revenue does not administer those local taxes, so confirm the rules with each city where you work.

The state sales tax rate is 6.5%. How sales tax applies to construction work can be complicated, so confirm your treatment with the Department of Revenue at dor.wa.gov before you invoice. Washington has 39 counties and 281 incorporated cities and towns, and each may add its own permit or license requirements. Check with the jurisdictions where you plan to work.

Step 8: Keep your registration and filings current

Calendar your L&I renewal date. The registration covers two years, and your bond and insurance must remain continuous through that period. If you formed an LLC, the annual report costs $70 and is due by the last day of the month in which the LLC was originally formed, every year. You can file up to 180 days early. A late filing carries a delinquency fee, for a total of $95.

Common mistakes to avoid

• Looking for a test. General contractor registration has no exam. Pay for the registration, not for test prep.
• Using old bond amounts. The current bond is $30,000 for general and $15,000 for specialty.
• Naming the wrong certificate holder. The insurance certificate must show L&I as certificate holder.
• Letting insurance or the bond lapse. A canceled policy or bond suspends your registration automatically, and your work can stop with it.
• Advertising before you are registered. Unregistered advertising is a gross misdemeanor, even if you have already filed the other paperwork.
• Using a PO Box for your registered agent. Washington requires a physical street address in the state.
• Filing with the BLS before the Secretary of State. An LLC, corporation, LLP, or partnership must file with the Secretary of State first.
• Forgetting trade names. If your ads use a name other than your legal name, register it through the BLS.
• Skipping the city B&O check. Many cities levy their own B&O tax on top of the state tax.

What to expect

If your documents are ready, you can reasonably expect the state business license and L&I registration to take a few weeks combined. The BLS online step alone is typically about 10 business days, and endorsements can add 2 to 3 weeks. Once you are registered, you can generally bid on residential and commercial work, pull permits in cities that check your number, and show your registration to customers as proof you meet the state's requirements. These outcomes depend on your application being complete and on the agencies' current processing times, so treat the timelines here as estimates.

Key costs at a glance

Item	Cost	Agency
Certificate of Formation (LLC) with Initial Report	$180	Secretary of State (CCFS)
Name reservation (180 days)	$30	Secretary of State
Expedited service, per entity	$100	Secretary of State
LLC annual report	$70, or $95 if late	Secretary of State
Business License Application (open a business)	$50, plus endorsement fees	Department of Revenue (BLS)
Trade name registration, each	$5	Department of Revenue (BLS)
L&I contractor registration, two years	$150.20	L&I
L&I reinstatement	$70.90	L&I
Surety bond	$30,000 general or $15,000 specialty (you pay a premium, not the face amount)	Surety company
Liability insurance	Premium varies; $250,000 combined single limit minimum	Insurance carrier

For the current figures on any line above, check the agency page before you pay. Premiums for bonds and insurance depend on your credit, claims history, and coverage, so no single number applies to every contractor.

Next steps

1. Choose your structure and, if you form an entity, file through ccfs.sos.wa.gov.
2. Get your UBI and any trade names through the Business Licensing Service.
3. Bind liability insurance and post your surety bond.
4. Register with L&I and confirm your registration number.
5. Add your registration number to all advertising and set up your written disclosure statement.
6. Confirm your state and local tax obligations, including B&O.

The Washington Small Business Development Center offers free and low-cost advising at wsbdc.org, and the Seattle SBA district office covers resources at sba.gov/district/seattle.

Disclaimer

This article is informational content, not legal or tax advice. Fees, bond and insurance requirements, and processing times change, so confirm current figures with the agency named in each section before you file or pay. For complex situations, including choosing a business structure, reviewing contracts, handling tax treatment of your work, or dealing with a lapsed registration, consult a qualified attorney or certified public accountant.