Tennessee Contractor License Classifications

The classification on your Tennessee contractor license determines exactly what kind of work you can bid on, what project values you can take, and whether you need trade exams. Picking the wrong classification — or bidding on work outside your classification — can get your bid thrown out and cost you your mechanics' lien rights.

The Main Classifications

BC-A: Residential Contractor

The BC-A classification covers construction, remodeling, and repair of residential structures up to three stories. This is the most common starting point for contractors entering residential building or renovation work.

Requirements: Pass both the Tennessee Business and Law exam and the BC-A trade exam. Submit a CPA-reviewed financial statement or a Contractors' Surety Bond to establish your monetary limit.

Your monetary limit (10 times the lesser of working capital or net worth) sets the maximum value for any single project. Licensed BC-A holders get a 10% bidding tolerance above their limit.

BC-A/r: Restricted Residential Limited License

Designed as an entry-level pathway, the BC-A/r waives both the trade exam and the Business and Law exam. Instead, you complete an approved Limited License course at a Tennessee community college or vocational school.

The tradeoff is significant: your project cap is $125,000 per contract, you get zero bidding tolerance (not the 10% that standard licensees receive), and you cannot enter joint ventures. To move past these restrictions, you need to go back and pass the standard exams and submit a CPA-reviewed financial statement.

BC-B: Commercial Contractor

The BC-B classification covers commercial, industrial, and institutional construction. Requirements mirror the BC-A path — Business and Law exam plus a trade-specific exam — but the trade exam tests commercial construction knowledge.

Specialty Classifications

Tennessee also licenses specialty contractors in specific trades: mechanical (CMC), plumbing (CMC-A), electrical (CE), and others. Plumbing and full mechanical exam candidates must obtain pre-approval from the Board by submitting a Pre-Approval Request Form with a $50 fee before scheduling their exam. No pre-approval is needed for BC-A or BC-B exams.

The 60% Rule

Your classification must cover at least 60% of the total project value for any project you bid on. If you hold a commercial classification and bid on a mixed-use project where commercial work accounts for less than 60%, you must subcontract the portions exceeding $25,000 to properly classified contractors.

This rule catches contractors who hold a residential license but try to take a commercial project (or vice versa) without the matching credential.

Adding Classifications

You can add classifications to an existing license without applying from scratch. The process requires passing the trade exam for the new classification and submitting the request through the CORE portal. Your monetary limit and financial documentation apply across all classifications on a single license.

Home Improvement License

Separate from the state contractor classifications, nine Tennessee counties — Bradley, Davidson, Hamilton, Haywood, Knox, Marion, Robertson, Rutherford, and Shelby — require a Home Improvement (HI) license for residential remodeling projects valued between $3,000 and $24,999. The HI credential does not substitute for a state contractor license on projects at $25,000 or above.

The Tennessee General Contractor License Guide maps every classification to its exam requirements, fee structure, and project scope, so you can pick the right path without sorting through the Board's scattered documentation.

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