By Shauna Krause, President, Capitol Services, Inc.
Contractors are tough, but ‘growth’ is not without pain, even for these men and women. While ‘misdirection’ works in magic acts, it’s costly and time consuming when a contractor loses focus on ‘facts’. I will wrap up with a ‘memory fail’ that is also a lesson on getting expert advice before the wrecking ball swings into action!..
Q: Our company is going to be acquiring a business that holds contractor’s licenses in Nevada and Arizona. Will these existing licenses be transferrable to the new entity we are forming?
A: No, contractor’s licenses in Nevada and Arizona are not transferrable from one entity to another. You will be required to obtain a new license in each State for the new entity you are forming.
Q: We are applying for a Nevada Contractor’s license. I let my boss know about the financial requirement and he is balking at getting a CPA reviewed financial statement. He said it is pretty expensive to have that done. Our max job in Nevada would be $100,000. Would a tax return or a credit report also do the trick? We have excellent credit.
A: For a monetary limit of $100,000, a compiled financial statement with full disclosures prepared by a CPA dated within the last 6 months is required. That’s the facts. A reviewed financial is only required for limits over $250,000. From what I understand, a compiled financial statement is not quite as pricey as reviewed. A tax return or credit report will not be accepted in lieu of the compiled financial statement.
Q: You are helping us with a contractor’s license right now and we decided we want to register our LLC with a ‘dba’ (doing business as) name with the CA Secretary of State. How do we go about doing that on the forms you sent us?
A: You can only have a ‘dba’ name with the CA Secretary of State if your business name in your home state is not available. Since your business name is available, you will only be able to file that ‘dba’ name with the CSLB. At that point, you can either do business as the entire name listed on the license, or just the ‘doing business as’ (dba) name.
Q: What are the rules regarding asbestos for General Building contractors? I remember taking some sort of asbestos exam when I originally obtained my license. I’m going to be demolishing a project which may require some asbestos abatement.
A: “B” General Building contractors cannot contract for jobs involving asbestos abatement unless one of the following conditions exists: a) they hold a “C-22” Asbestos Abatement specialty license, or b) they hold an Asbestos Certification and are registered with the Department of Industrial Relations Division of Occupational Safety and Health (DASH), or c) they subcontract the work with an appropriately licensed contractor.
The exam you remember taking is likely the Open Book Asbestos exam, which is required for all new contractors. Taking that open-book exam does not allow you to perform asbestos abatement work.
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While knowledge is power, knowing where to go for the answers is half the battle. Get expert assistance immediately when you call 866-443-0657, email info@cutredtape.com, or write us at Capitol Services, Inc., 1225 8th St. Ste. 500, Sacramento, CA 95814. Research past columns at www.cutredtape.com.