California’s New $1,000 Contractor License Threshold: What It Means for Homeowners and Handypeople

If you live in California and are planning to hire a contractor, or you're a handyperson doing small home repairs, there’s a big legal change coming in 2025 you need to know about.

Starting January 1, 2025, California’s Contractors State License Board (CSLB) will raise the threshold for when a contractor’s license is required from $500 to $1,000. That means unlicensed individuals will now be allowed to perform more types of small-scale work legally, but only under very specific conditions.

In this post, we’ll break down exactly what this new $1,000 contractor license threshold means for:

• Homeowners hiring handypeople
  
  
• Unlicensed contractors or “handypeople”
  
  
• Anyone concerned about avoiding scams or fines
  

Let’s dive in.

What Is the New $1,000 Contractor License Threshold?

The new law, Assembly Bill 2622 (AB 2622), was passed in 2024 and became active on January 1, 2025.

In simple terms:

• If the total project cost is $1,000 or less, a contractor license is not required—as long as no building permits are needed and the worker does not employ anyone else.
  
  
• The $1,000 total must include labor, materials, and any other related costs.
  
  

This is a major increase from the current $500 limit and will allow unlicensed handypeople to do twice as much value in repairs or improvements—legally.

What This Means for Homeowners in California

If you’re a homeowner, this new threshold provides a bit more flexibility when hiring help for small jobs.

You can legally hire an unlicensed individual for home maintenance or light repairs under $1,000, as long as:

• No permits are required for the job
  
  
• The individual is working alone, not as part of a team or company
  
  
• They clearly advertise themselves as unlicensed
  
  

Helpful Resource: CSLB - Hiring a Contractor

Example: Need someone to patch drywall, paint a room, or fix a leaky faucet? If the total bill is under $1,000, and the job doesn’t require permits or a second set of hands, you’re good to go.

But—if you’re doing a kitchen remodel, anything involving electrical or plumbing permits, or hiring a crew—you’ll need a licensed contractor.

What Handypeople & Unlicensed Contractors Should Know

If you're a handyman or handyperson operating without a license, this law expands your opportunities—but also comes with strict limitations you must follow to stay legal:

You CAN:

• Perform repair or improvement jobs totaling $1,000 or less
  
  
• Advertise your services (as long as you clearly state you’re not licensed)
  
  

You CANNOT:

• Split a bigger project into multiple $1,000 jobs to avoid needing a license
  
  
• Hire workers or subcontractors to help
  
  
• Do any work that requires a building permit, even if the job is under $1,000
  
  

Penalties for Violating California Contractor Law:
According to the CSLB, unlicensed contracting can result in:

• Fines of up to $15,000
  
  
• Jail time of up to 6 months
  
  
• Repeat violations = mandatory 90-day jail sentence and higher fines (up to $5,000 or 20% of the project cost)
  
  

Pro Tip: Never assume you’re “safe” just because a job is small—check if it requires permits, and avoid taking on any work that might creep over the limit. You can visit the CSLB Official Website to stay informed and access licensing tools and forms.

How to Verify a Contractor’s License in California

Homeowners should always check the license status of any professional doing work on their home.

Use www.CheckTheLicenseFirst.com — a free tool from the CSLB — to verify:

• The contractor’s license status
  
  
• Their classification and scope of work
  
  
• Any disciplinary actions or complaints
  
  

This small step can save you thousands of dollars and legal headaches.

Why This Matters: Avoiding Scams & Senior Fraud

The CSLB warns that scam contractors often target seniors and vulnerable homeowners with misleading claims, hidden fees, and illegal, unlicensed work.

The new $1,000 threshold doesn’t change the fact that:

• Licensed contractors are still required for any larger projects or those involving permits or crews
  
  
• Unlicensed individuals can’t charge over $1,000 or skip the legal disclosures
  
  

If you’re a senior homeowner, visit SeniorScamStopper.com for education and events hosted by CSLB to help seniors avoid contractor fraud and home improvement scams.

Quick Summary: What You Need to Know

* Only if no permit or additional workers are involved.

Final Thoughts

The new $1,000 contractor license threshold in California brings more flexibility to homeowners and opportunities for handypeople, but only if everyone follows the rules.

If you’re a homeowner:

• Know your project’s value, permit status, and labor needs
  
  
• Verify licenses before hiring
  
  
• Pay smart (never over 10% down), as required by California law
  
  

If you’re a handyperson:

• Stick to jobs under $1,000
  
  
• Work solo
  
  
• Clearly advertise your unlicensed status
  
  

These rules exist to protect both sides, promote safety, and ensure that fair work is done legally. As with any law, understanding the fine print is key.

Need Help With Contractor Insurance or Licensing Advice?

At RVIS Insurance Agency, we help contractors, handypeople, and construction pros in California stay compliant and protected. Whether you need help navigating contractor insurance, bonding, or getting properly licensed, we’ve got your back.