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A new law raised the threshold for work requiring a contractor’s license from $500 to $1,000, effective January 1, 2025, there are additional parameters which apply.
Assembly Bill 2622 (Carrillo, Chapter 240, Statutes of 2024),was effective January 1, 2025. It allows an unlicensed person to complete small projects up to $1,000 without obtaining a contractor’s license
- if they do not hire workers and no building permits are needed.
- total contract price for labor, materials, and all other items on a project is less than $1,000
- The $1,000 includes all costs associated with the project.
- Advertisements must state the person is not licensed.
If a consumer’s project under $1,000 requires workers or permits, a contractor’s license in the appropriate license classification is required.
As with any home improvement construction project, CSLB cautions that a down payment should not exceed 10 percent of the contract price, and any subsequent payments should not exceed the value of the work completed or the materials delivered.
If an unlicensed person provides a bid greater than $1,000, performs work requiring a permit, or employs any workers, that person is subject to legal action. Penalties for unlicensed contracting include administrative fines of up to $15,000, jail sentences of up to six months, and fines up to $5,000. Repeat offenders may face a mandatory 90-day jail sentence and a fine of $5,000 or 20 percent of the contract price, whichever is greater.
For more information, visit CSLB’s website, or connect with us on Facebook, X/Twitter, Instagram, and YouTube.
About CSLB: CSLB operates under the umbrella of the Department of Consumer
Affairs and licenses and regulates about 285,000 contractors in California.
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