What unlicensed contracting costs the contractor and the person who hires one: criminal charges, board fines up to $50,000, lost payment and lien rights, and hiring side penalties, with a sourced table for 13 states.
A contractor caught working without a required license usually faces a misdemeanor charge, a board fine that can reach $50,000 per violation in Nevada, and the loss of the right to sue for payment or file a lien. The person who hires that contractor can face penalties too: Florida can fine anyone who employs an unlicensed contractor up to $5,000 per incident, Tennessee makes accepting an unlicensed bid over $25,000 a crime, in California, Nevada and Louisiana a licensed contractor who hires an unlicensed one faces discipline, and in Texas employing an unlicensed electrician or plumber is itself a misdemeanor.
At a glance
- Contractor, first offense: a misdemeanor in all 13 states in the table below; in Texas it is a Class C misdemeanor, a fine of up to $500 with no jail.
- Board or civil fines: up to $15,000 per citation in California, a DBPR administrative fine of up to $10,000 in Florida, and $50,000 per violation in Nevada.
- Repeat offenses: a felony on the second offense in Florida and on the third in Nevada and Virginia.
- Hiring side: fines, licensee discipline, liability for injured workers, and the risk of paying subcontractors twice.
Every figure below comes from the statute or the licensing board, read on September 28, 2026. For the licensing rules in all 50 states, start with how to get a contractor license in each state.
What Unlicensed Contracting Costs the Contractor
Unlicensed contracting is punished in four layers, and one job can trigger all of them at once.
Criminal charges. Jail terms reach one year in Florida, Michigan, South Carolina and Virginia, while a Texas Class C misdemeanor is a fine of up to $500 with no jail. Repeat offenses and work in declared disaster areas can become felonies.
Board and civil fines. Licensing boards fine unlicensed contractors directly, without a trial. California citations run from $1,500 to $15,000 under Business and Professions Code 7028.7, as amended by SB 779 and operative July 1, 2026.
Lost payment and lien rights. In the 11 states in the collection table below, the unlicensed contractor loses some or all of its right to sue or file a lien, and in California it can be sued to return what the customer already paid.
Stop work orders. Florida's Department of Business and Professional Regulation can stop all unlicensed work on a project under F.S. 489.127(3).
The State by State Table
The table covers 13 states with a statewide contractor or trade licensing law.
| State | First offense | Repeat or aggravated | Board or civil fine |
|---|---|---|---|
| Arizona | Class 1 misdemeanor: $1,000 to $2,500, up to 6 months | $2,000 minimum fine | Cease and desist order |
| California | Up to $5,000 and 6 months | 90 days jail; $5,000 or 20 percent of price | $1,500 to $15,000 per citation |
| Florida | First degree misdemeanor: up to $1,000 and 1 year | Second offense: third degree felony, up to $5,000, 5 years | DBPR administrative fine up to $10,000 |
| Georgia | Misdemeanor: at least $1,000, or 3 months, or both | Same penalty for each offense | Not set in 43-41-12 |
| Louisiana | Up to $500 per day or 3 months | Harm over $300: up to $5,000, 5 years | Board fines, cease and desist |
| Michigan | $5,000 to $25,000, up to 1 year | Up to 2 years; felony if death or serious injury | Civil fine $5,000 to $25,000 |
| Nevada | $1,000 to $4,000, up to 6 months | Third offense: category E felony | $1,000 to $50,000 per violation |
| North Carolina | Class 2 misdemeanor: up to $1,000 | Up to 60 days with five or more priors | Injunction and fee award |
| Oregon | Class A misdemeanor | Class A misdemeanor | Up to $5,000 per offense |
| South Carolina | Up to $5,000 or 1 year | Up to $5,000 or 1 year | Injunction |
| Tennessee | Class A misdemeanor | Class A misdemeanor | Up to $5,000 per offense |
| Texas | Class C misdemeanor: up to $500 | Each day a separate violation | Up to $5,000 per violation |
| Virginia | Up to $2,500 and 12 months, plus $500 per day | Class 6 felony on third in 36 months | $200 to $5,000 per violation |
State notes
- Arizona: acting as a contractor without a license is a class 1 misdemeanor with a $1,000 minimum fine, and $2,000 on a second offense (A.R.S. 32-1164). The class 1 maximums are $2,500 (A.R.S. 13-802) and six months (A.R.S. 13-707).
- California: a first conviction carries up to $5,000 and six months. A second brings the greater of $5,000 or 20 percent of the contract price and at least 90 days in jail; a third runs up to one year (B&P 7028). Citations are separate (B&P 7028.7).
- Florida: a first violation is a first degree misdemeanor, up to one year and $1,000. A second is a third degree felony, up to five years and $5,000 (F.S. 489.127; caps in F.S. 775.082 and 775.083). The DBPR administrative fine of up to $10,000 is a separate, noncriminal penalty (F.S. 489.13).
- Georgia: unlicensed contracting is a misdemeanor punished, for each offense, by a fine of at least $1,000, three months in jail, or both; SB 503 raised the minimum from $500 on July 1, 2024 (O.C.G.A. 43-41-12, 2025 code on Justia).
- Louisiana: the base penalty is up to $500 per day of violation, three months, or both; if the work harms someone by more than $300, the range is $500 to $5,000 and six months to five years (R.S. 37:2163).
- Michigan: the $5,000 to $25,000 range applies to unlicensed residential builders and maintenance and alteration contractors; an offense causing death or serious injury is a felony up to four years (MCL 339.601).
- Nevada: a second offense is a gross misdemeanor, $4,000 to $10,000 and up to 364 days; a third is a category E felony, $10,000 to $20,000 and one to four years. Fines can add up to 10 percent of the contract value (NRS 624.750).
- North Carolina: unlicensed general contracting is a Class 2 misdemeanor (G.S. 87-13), fined up to $1,000 (G.S. 15A-1340.23). When the board wins an injunction, the court awards its attorney fee up to $5,000 plus costs (G.S. 87-13.1).
- Oregon: working without a Construction Contractors Board license is a Class A misdemeanor, and the board adds civil penalties per offense (ORS 701.990 and 701.992).
- South Carolina: the penalty is up to one year or up to $5,000 (S.C. Code 40-11-200).
- Tennessee: unlicensed contracting is a Class A misdemeanor, the board can impose up to $5,000 per offense, and it can refuse a license for six months (T.C.A. 62-6-120, 2025 code on Justia).
- Texas: unlicensed electrical or plumbing work is a Class C misdemeanor (Occ. Code 1305.303, 1301.508), punished by a fine of up to $500 (Penal Code 12.23). TDLR may also assess up to $5,000 per day for each electrical violation (Occ. Code 51.302), and its schedule lists unlicensed electrical work at $2,000 to $5,000 (TDLR electricians sanctions). Plumbing penalties run up to $5,000 per violation, each day counted separately (Occ. Code 1301.702).
- Virginia: a Class 1 misdemeanor (Code 54.1-1115) carries up to 12 months and $2,500 (Code 18.2-11), plus up to $500 for each day of unlicensed work. A third conviction within 36 months is a Class 6 felony, and DPOR's civil penalties are capped at $25,000 per year (Code 54.1-111).
The Hiring Side: What an Owner or GC Risks
Most criminal statutes aim at the contractor, but several states reach the owner, the public agency or the licensed contractor that brought the unlicensed one onto the job.
| State | Who is exposed | What the law says | Law |
|---|---|---|---|
| California | Licensed contractor | Cause for discipline | B&P 7118 |
| California | Public entity officer | Citation after the registrar's notice | B&P 7028.7(b) |
| California | Owner who hires unlicensed workers | Workers presumed to be employees | Labor Code 2750.5 |
| Florida | Anyone who employs one | Up to $5,000 per incident | F.S. 455.228 |
| Georgia | Architect or engineer | Misdemeanor for knowingly recommending | O.C.G.A. 43-41-12(b) |
| Louisiana | Licensed contractor | Listed violation; board fines | R.S. 37:2158(A)(7) |
| Nevada | Licensed contractor | Board must fine $1,000 to $50,000 if knowing | NRS 624.3015(4), 624.300(3) |
| North Carolina | Architect or engineer | Class 2 misdemeanor for recommending | G.S. 87-13 |
| South Carolina | Owner, awarding authority or contractor | Violation to sign or let work begin | S.C. Code 40-11-200(B) |
| Tennessee | Anyone accepting a bid over $25,000 | Class A misdemeanor | T.C.A. 62-6-120(b) |
| Texas | Employer of unlicensed electrician or plumber | Class C misdemeanor | Occ. Code 1305.303, 1301.508 |
| Virginia | Awarding authority | Class 1 misdemeanor if it knows | Code 54.1-1115(A)(6) |
Notes on the hiring side
- Florida: DBPR can send a cease and desist notice to anyone who aids and abets unlicensed work by employing the unlicensed person, impose up to $5,000 per incident, or ask a circuit court for $500 to $5,000 per offense (F.S. 455.228).
- Tennessee: the (a)(1) penalties do not apply to a person who hires an unlicensed contractor to build a residence for that person's own use (T.C.A. 62-6-120).
- Nevada: a licensee who knowingly contracts with an unlicensed contractor must be fined $1,000 to $50,000 and can be suspended for six months on a first offense (NRS 624.3015 and 624.300).
- California: a worker doing licensed work must hold a license to be treated as an independent contractor (Labor Code 2750.5). A licensee who contracts with an unlicensed contractor faces discipline (B&P 7118).
- Texas: a person who employs someone without the required electrical or plumbing license commits a Class C misdemeanor (Occ. Code 1305.303, 1301.508), and a licensed electrical contractor that fails to ensure all electrical work is done by licensed individuals commits a listed violation (TDLR electricians sanctions).
The Money a Homeowner Can Lose
For most homeowners the bigger cost is not a fine. St. Johns County, Florida, warns that a homeowner can be held liable for injuries to people working on the property when the unlicensed person has no insurance, including that person's own injuries (St. Johns County guide).
The same county guide warns that if the unlicensed contractor does not pay subcontractors or suppliers, the homeowner may have to pay them, even after paying the contractor. A homeowner who pulls the permit for an unlicensed contractor is also responsible for the work.
In California, the person who used an unlicensed contractor is a crime victim eligible for restitution after a conviction, whether or not the person knew (B&P 7028).
Can an Unlicensed Contractor Collect Payment or File a Lien?
In the states below, a contractor who was unlicensed when the work was contracted or performed loses some or all of the court remedies a licensed contractor keeps.
| State | Sue to collect? | Lien or bond claim? | Law |
|---|---|---|---|
| Arizona | No | Not covered by this section | A.R.S. 32-1153 |
| California | No; customer can recover payments | Security interest unenforceable | B&P 7031 |
| Florida | No, contract unenforceable | No | F.S. 489.128, 713.02(7) |
| Georgia | No, contract unenforceable | No | O.C.G.A. 43-41-17(b) |
| Louisiana | No statement of claim | No lien or privilege | R.S. 37:2159(D) |
| Michigan | No | No | MCL 339.2412 |
| Nevada | No; contract void | Not covered by this section | NRS 624.320, 624.700 |
| Oregon | No, narrow exception | No | ORS 701.131 |
| South Carolina | No | Not covered by this section | S.C. Code 40-11-370(C) |
| Tennessee | Documented expenses only | No | T.C.A. 62-6-103 |
| Virginia | No, narrow good faith exception | Not covered by this section | Code 54.1-1115(C) |
Collection notes
- Florida: a business organization counts as unlicensed if it lacks a primary or secondary qualifying agent for the scope of the work (F.S. 489.128), and no lien exists in its favor (F.S. 713.02).
- Georgia: the rule covers contracts entered on or after July 1, 2008 (O.C.G.A. 43-41-17, 2025 code on Justia).
- Tennessee: an unlicensed contractor may recover only actual documented expenses shown by clear and convincing proof (T.C.A. 62-6-103).
- Virginia: the exception needs substantial performance in good faith and no actual knowledge that a license was required; a lapsed renewal creates a presumption of knowledge (Code 54.1-1115).
Picture a $200,000 remodel in California, finished well, with a final invoice unpaid. If the contractor was unlicensed, B&P 7031 blocks the lawsuit regardless of the merits, and the owner can sue to recover the payments already made. CSLB states that consumers are not legally required to pay a person who is not state licensed (CSLB).
When Unlicensed Contracting Becomes a Felony
In Florida, a second unlicensed contracting offense is a third degree felony, and so is any unlicensed contracting during a declared state of emergency (F.S. 489.127). A third degree felony carries up to five years (F.S. 775.082) and up to $5,000 (F.S. 775.083).
In California, unlicensed repair work on property damaged in a declared natural disaster is punishable by up to $10,000 and a sentence of 16 months, two years or three years (B&P 7028.16). Nevada makes a third offense a category E felony, Virginia makes a third conviction within 36 months a Class 6 felony, and Michigan makes an unlicensed residential builder's offense a felony when it causes death or serious injury.
How Unlicensed Contractors Get Caught
- Stings and site sweeps. CSLB's Statewide Investigative Fraud Team runs undercover stings and construction site sweeps each week (CSLB).
- Permit records. Louisiana board staff may inspect the permit list of every local permit office each month (R.S. 37:2160), and Florida building departments may not issue permits to unlicensed contractors (F.S. 489.13).
- Advertising. In Florida, advertising as available to act as a contractor without being certified or registered is itself a violation (F.S. 489.127).
- Bids. Nevada makes submitting a bid without a license unlawful, and the board may refuse a license for up to one year after an unlicensed bid of $1,000 or more (NRS 624.700 and 624.247).
- Competitors. In Michigan, a person directly affected by unlicensed practice can sue for an injunction and, if successful, recover actual costs and attorney fees (MCL 339.601).
Why the Qualifying Agent Matters to a Company's License
Many companies that end up "unlicensed" were licensed once. In several states the company's license rests on a qualifying individual, and losing that person puts the company at risk. Florida treats a business organization as unlicensed for contract purposes if it has no primary or secondary qualifying agent, and it prohibits operating more than 60 days after the only qualifying agent leaves without designating another (F.S. 489.127(1)(g)).
Georgia makes it a misdemeanor to operate a contracting business more than 180 days after its only qualifying agent leaves without designating another (O.C.G.A. 43-41-12), and Louisiana lists failure to maintain a qualifying party as grounds for board action (R.S. 37:2158). A qualifying agent is a licensed professional who meets the state's experience and exam rules and actually supervises the work, and that person qualifies the company. If your company needs a qualifier now, or needs to replace one before a deadline runs, we can connect you with one.
Getting Compliant, in Order
- Stop bidding and advertising unlicensed work. In Nevada and Florida the bid or the advertisement is itself a violation.
- Confirm what license the work requires. Check the state board's classification and dollar threshold in our state by state guide, and whether a local license applies as well.
- Decide who qualifies the company. Either an owner meets the experience and exam rules, or the company brings on a qualifying agent who meets them.
- File the application. Include the bond, insurance and exam results the board requires for your classification.
- Resolve any open case. In Florida, DBPR may waive up to half of its fine if the contractor gets licensed within one year of the fine (F.S. 489.13).
- Pull permits in the licensed name, in every state you work. For work across state lines, see getting licensed in another state.
Until the license issues, the lawful path is to work as an employee of a licensed contractor rather than as an unlicensed subcontractor, because several of the laws above apply to unlicensed subcontractors too. If a permit question is what brought you here, read can you pull a permit without a contractor license.
Frequently Asked Questions
What is the penalty for hiring an unlicensed contractor?
It depends on the state and on who hired. Florida can fine anyone who employs an unlicensed contractor up to $5,000 per incident, Tennessee makes accepting an unlicensed bid over $25,000 a Class A misdemeanor, South Carolina makes it a violation for an owner to let an unlicensed contractor begin work, and Texas makes employing an unlicensed electrician or plumber a Class C misdemeanor. Licensed contractors who hire unlicensed ones face discipline in California, Nevada and Louisiana.
Can a homeowner get in trouble for hiring an unlicensed contractor?
Yes, in some states, but the common cost is financial. A homeowner can be liable for injuries on the property and may have to pay unpaid subcontractors or suppliers, according to St. Johns County, Florida.
How much is the fine for contracting without a license?
Board and civil fines reach $5,000 per violation in Oregon, Tennessee, Texas and Virginia, $10,000 from DBPR in Florida, $15,000 per citation in California and $50,000 per violation in Nevada. Criminal fines are separate: a first offense caps at $500 in Texas and $1,000 in Florida and North Carolina, is at least $1,000 in Georgia, and reaches $25,000 for an unlicensed Michigan residential builder. California can also set the fine at 20 percent of the contract price on a repeat conviction.
A person who acts as a licensee while unlicensed faces an administrative fine of up to how much per day?
In Florida, DBPR may impose up to $5,000 per incident for the unlicensed practice of any profession it regulates, and each day the practice continues after a citation is a separate violation (F.S. 455.228). For unlicensed contracting, F.S. 489.13 raises the DBPR fine to up to $10,000, and a county or city enforcement board can order up to $2,500 per day for each violation (F.S. 489.127(5)). Virginia adds up to $500 for each day of unlicensed contracting on top of the misdemeanor penalty.
Is unlicensed contracting a felony?
Usually not on the first offense. It becomes a felony on a second offense in Florida, on a third in Nevada, and on a third within 36 months in Virginia. Disaster area work in Florida and California can be charged as a felony from the start.
Do I have to pay an unlicensed contractor?
In many states the contractor cannot sue you to collect. CSLB says consumers are not legally required to pay a person who is not state licensed, and California lets the customer sue to recover what was paid. Talk with a lawyer in your state before you withhold payment, since the rules and exceptions differ.
What is the difference between a licensed and an unlicensed contractor?
A licensed contractor has met the board's experience, exam, bond and insurance rules and can enforce its contracts and liens. An unlicensed contractor has not, so in most of the states above it loses those remedies and exposes its customers to injury and payment risk.
What law says this?
Each state's contractor licensing act. The main sections are California B&P 7028 and 7031, Florida Chapter 489, Nevada NRS Chapter 624, Virginia Code 54.1-1115 and the other statutes in the Sources list below.
Sources
All retrieved September 28, 2026.
- California B&P 7028, 7028.7, 7028.16, 7031 and 7118, California Legislative Information, retrieved 2026-09-28
- California Labor Code 2750.5, retrieved 2026-09-28
- CSLB: Consequences of Contracting Without a License, retrieved 2026-09-28
- Florida Statutes 489.127, 489.128, 489.13 and 455.228, Online Sunshine, retrieved 2026-09-28
- Florida Statutes 775.082, 775.083 and 713.02, retrieved 2026-09-28
- St. Johns County, Florida: Guide for Hiring Contractors, retrieved 2026-09-28
- Nevada NRS Chapter 624 (624.247, 624.300, 624.320, 624.3015, 624.700, 624.710, 624.750), retrieved 2026-09-28
- Arizona A.R.S. 32-1151, 32-1153, 32-1164, 32-1166, 13-707 and 13-802, retrieved 2026-09-28
- Georgia O.C.G.A. 43-41-12 and 43-41-17, 2025 Code of Georgia on Justia (the official code is published by LexisNexis), retrieved 2026-09-28
- Louisiana R.S. 37:2158, 37:2159, 37:2160 and 37:2163, retrieved 2026-09-28
- Michigan MCL 339.601 and 339.2412, retrieved 2026-09-28
- North Carolina G.S. 87-13, 87-13.1 and 15A-1340.23, retrieved 2026-09-28
- Oregon ORS Chapter 701 (701.131, 701.990, 701.992), retrieved 2026-09-28
- South Carolina Code Title 40, Chapter 11 (40-11-200, 40-11-210, 40-11-370), retrieved 2026-09-28
- Tennessee T.C.A. 62-6-103 and 62-6-120, 2025 Tennessee Code on Justia (the official code is published by LexisNexis), retrieved 2026-09-28
- Texas Occupations Code 51.302, 1301.508 and 1301.702 and 1305.303, Penal Code 12.23, and TDLR electricians penalties and sanctions, retrieved 2026-09-28
- Virginia Code 54.1-1115, 54.1-111 and 18.2-11, retrieved 2026-09-28
Talk With Us Before the Next Bid
The Licensing Company is led by Marshall Schofield and Jeremiah Jaskulski, recognized authorities on contractor licensing and the qualifying agent model. If you are working toward a license, replacing a qualifier, or cleaning up after a board letter, call us at 615-219-2110 or start at Hire a Qualifying Agent. We will tell you what your state requires and the fastest lawful way to get there.
Disclaimer: This article is provided for educational and informational purposes only. It does not constitute legal advice, licensing guidance, or an offer of services. Licensing requirements vary by jurisdiction. For specific compliance questions, contact The Licensing Company for a confidential consultation.