{"id":5288,"date":"2024-09-16T16:42:19","date_gmt":"2024-09-16T21:42:19","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-law\/smallbusiness\/starting-a-business\/how-to-open-a-construction-business.html"},"modified":"2025-06-24T12:34:00","modified_gmt":"2025-06-24T17:34:00","slug":"how-to-open-a-construction-business","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/smallbusiness\/starting-a-business\/how-to-open-a-construction-business.html","title":{"rendered":"How To Open a Construction Business"},"content":{"rendered":"\n<section data-testid=\"fl-simple-hero\"  class=\"fl-simple-hero\">\n    <div class=\"fl-simple-hero-container fl-container fl-flex fl-items-center\">\n                <div class=\"fl-simple-hero-title\" data-testid=\"fl-simple-hero-title\">How To Open a Construction Business<\/div>\n            <\/div>\n<\/section>\n    <div class=\"fl-container\">\n        <div class=\"updated-breadcrumb-list\">\n            <ol>\n                        <li>\n                <a href=\"https:\/\/www.findlaw.com\">FindLaw <\/a>\n                <span class=\"breadcrumb-separator\" aria-hidden=\"true\">\/<\/span>\n            <\/li>\n                                <li aria-current=\"page\">How To Open a Construction Business<\/li>\n            <\/ol>\n\n        <\/div>\n    <\/div>\n\n\n\n<div class=\"fl-sectionWithSidebar fl-container fl-flex fl-flex-wrap fl-gap30  wp-container-core-columns-is-layout-9d6595d7 fl-sectionWithSidebar fl-container fl-flex fl-flex-wrap fl-gap30\">\n<div class=\"fl-section-main fl-page-articles fl-section-main fl-section-main-full-width\"><h1 class=\"fl-no-margin-top\">How To Open a Construction Business<\/h1>\n\n\n<figure class=\"wp-block-image fl-no-margin\"><img decoding=\"async\" src=\"https://www.findlaw.com/static/c/images\/image\/upload\/ability-law\/wp-prod\/content-original-images-gettyimages-501463802.jpg\" alt=\"\"\/><\/figure>\n\n\n<section class=\"fl-gutenberg-byline\">\n    <div class=\"fl-gutenberg-byline-content\">\n                    By <a href=\"https:\/\/www.findlaw.com\/company\/our-team\/natalie-moritz\/\">Natalie Moritz<\/a> | Legally reviewed by <a\n                href=\"https:\/\/www.findlaw.com\/company\/our-team\/amber-sheppard-esq\/\">Amber Sheppard, Esq.<\/a>\n                | Last updated\n        <time>\n                            June 24, 2025\n                    <\/time>\n    <\/div>\n\n            <div class=\"fl-gutenberg-byline-editorial-note fl-text-sm\">\n            <p>Editorial Note: We earn a commission from affiliate partner links on FindLaw. Commissions do not affect the editorial integrity of our legal content.<\/p>\n\n        <\/div>\n    \n    <details class=\"fl-gutenberg-byline-toggle fl-gutenberg-byline-legally-reviewed\">\n        <summary>\n            <i class=\"fl-gutenberg-byline-icon\" aria-hidden=\"true\"><\/i>\n            Legally Reviewed\n        <\/summary>\n\n        <div class=\"fl-gutenberg-byline-toggle-content\">\n            <p><em>This article has been written and reviewed for legal accuracy, clarity, and style by <a href=\"https:\/\/www.findlaw.com\/company\/our-team.html\">FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with <a href=\"https:\/\/www.findlaw.com\/company\/company-history\/editorial-policy.html\">our editorial standards<\/a>.<\/em><\/p>\n\n        <\/div>\n    <\/details>\n\n    <details class=\"fl-gutenberg-byline-toggle fl-gutenberg-byline-fast-checked\">\n        <summary>\n            <i class=\"fl-gutenberg-byline-icon\" aria-hidden=\"true\"><\/i>\n            Fact-Checked\n        <\/summary>\n\n        <div class=\"fl-gutenberg-byline-toggle-content\">\n            <p><em>The last updated date refers to the last time this article was reviewed by FindLaw or one of our <a href=\"https:\/\/www.findlaw.com\/company\/our-team\/contributing-authors.html\">contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please <a href=\"https:\/\/lawyers.findlaw.com\/?fli=bylinelink\" target=\"_blank\" rel=\"noopener\">contact an attorney in your area<\/a>.<\/em><\/p>\n\n        <\/div>\n    <\/details>\n<\/section>\n\n\n    <div class=\"fl-callout-text article-blockquote\">\n        <p>Starting a <span data-action=\"click-&gt;dropdown#toggle\" data-dropdown-menu-id-param=\"menu_report_term_26299484\" data-dropdown-placement-param=\"top\" data-dropdown-disable-toggle-aria-param=\"true\" data-term-id=\"26299484\">construction business<\/span> begins with a <span data-action=\"click-&gt;dropdown#toggle\" data-dropdown-menu-id-param=\"menu_report_term_26299522\" data-dropdown-placement-param=\"top\" data-dropdown-disable-toggle-aria-param=\"true\" data-term-id=\"26299522\">solid <\/span><span data-action=\"click-&gt;dropdown#toggle\" data-dropdown-menu-id-param=\"menu_report_term_26299485\" data-dropdown-placement-param=\"top\" data-dropdown-disable-toggle-aria-param=\"true\" data-term-id=\"26299485\">business plan<\/span>, choosing a <span data-action=\"click-&gt;dropdown#toggle\" data-dropdown-menu-id-param=\"menu_report_term_26299494\" data-dropdown-placement-param=\"top\" data-dropdown-disable-toggle-aria-param=\"true\" data-term-id=\"26299494\">business name<\/span> and corporate structure, getting necessary licenses and permits, and securing funding.<\/p>\n\n    <\/div>\n\n\n\n<p><b><i>Form your LLC with confidence.\u202f<a href=\"https:\/\/legalzoomcominc.pxf.io\/c\/4851649\/2115288\/26746?subId1=how-to-open-a-construction-business-in-content\" target=\"_blank\" rel=\"noopener\">Our trusted partner LegalZoom has packages starting at $0 + filing fees.<\/a><\/i><\/b><\/p>\n\n\n<div class=\"tableOfContent\">\n    <div class=\"table-of-contents\">\n        <span role=\"heading\" aria-level=\"2\" class=\"table-of-contents__title\">15 Steps To Open a Construction Business<\/span>\n                <ul class=\"table-of-contents__list\">\n                        <li><a href=\"#Research\" title=\"1. Research the Construction Industry\">1. Research the Construction Industry<\/a><\/li>\n                        <li><a href=\"#Network\" title=\"2. Network With Suppliers, Other Contractors, and Subcontractors\">2. Network With Suppliers, Other Contractors, and Subcontractors<\/a><\/li>\n                        <li><a href=\"#Determine\" title=\"3. Determine Your Niche\">3. Determine Your Niche<\/a><\/li>\n                        <li><a href=\"#Pick\" title=\"4. Pick a Business Name and Trademark It\">4. Pick a Business Name and Trademark It<\/a><\/li>\n                        <li><a href=\"#Choose\" title=\"5. Choose a Legal Business Structure\">5. Choose a Legal Business Structure<\/a><\/li>\n                        <li><a href=\"#Write\" title=\"6. Write a Business Plan\">6. Write a Business Plan<\/a><\/li>\n                        <li><a href=\"#Sub\" title=\"7. Choose Your Subcontractors\">7. Choose Your Subcontractors<\/a><\/li>\n                        <li><a href=\"#Learn\" title=\"8. Learn About Construction Finance\">8. Learn About Construction Finance<\/a><\/li>\n                        <li><a href=\"#Use\" title=\"9. Use Construction Software\">9. Use Construction Software<\/a><\/li>\n                        <li><a href=\"#Protect\" title=\"10. Protect Your Brand and Plan for Growth\">10. Protect Your Brand and Plan for Growth<\/a><\/li>\n                        <li><a href=\"#Contracts\" title=\"11. Use Written Contracts Only\">11. Use Written Contracts Only<\/a><\/li>\n                        <li><a href=\"#Understand\" title=\"12. Understand the Laws and Regulations of the Construction Business\">12. Understand the Laws and Regulations of the Construction Business<\/a><\/li>\n                        <li><a href=\"#Educate\" title=\"13. Educate Yourself on Government Contracts\">13. Educate Yourself on Government Contracts<\/a><\/li>\n                        <li><a href=\"#Hire\" title=\"14. Understand Hiring, Employment Law, and Taxation\">14. Understand Hiring, Employment Law, and Taxation<\/a><\/li>\n                        <li><a href=\"#Insurance\" title=\"15. Obtain Business Insurance\">15. Obtain Business Insurance<\/a><\/li>\n                    <\/ul>\n            <\/div>\n<\/div>\n\n\n<p>If you are passionate about building beautiful, functional commercial spaces or homes, opening a construction business might be for you.&nbsp;Find the information you need to launch what can potentially be a profitable and fulfilling business.<\/p>\n<p>Starting your own construction business takes a significant financial investment and extensive business and legal planning. Use this guide to learn the financial, business, and legal steps to start your own construction company.<\/p>\n<p>See FindLaw&#8217;s&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/starting-a-business.html\">Starting a Business<\/a>&nbsp;section for more articles and resources on starting and operating your small business.<\/p>\n\n\n\n<h2>15 Steps To Open a Construction Business<\/h2>\n\n\n<div class=\"general-step-component\">\n    <div class=\"steps-container\">\n                    <div class=\"steps-container-item\">\n                <div class=\"category-overview category-overview-item-steps\">\n                    <div class=\"category-overview-heading category-overview-heading-steps\">\n                        <div class=\"category-overview-steps\">\n                            1\n                        <\/div>\n                        <h2 class=\"category-overview-steps-title\" id=\"Research\">Research the Construction Industry<\/h2>\n                    <\/div>\n                    <div class=\"category-overview-content-steps\">\n                        <p>The\u00a0<a title=\"First Steps To Start a Business\" href=\"https:\/\/www.findlaw.com\/smallbusiness\/starting-a-business\/first-steps.html\">first step<\/a>\u00a0in opening any business is to understand the industry.\u00a0<a title=\"Marketing Research\" href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-operations\/marketing-research.html\">Market research<\/a>\u00a0is critical in a business venture as complex as launching a new construction company.<\/p>\n<p>Understanding the construction business from the ground up is the best approach. Entrepreneurs with industry experience have an advantage. Knowing the terminology and having connections in the business is extremely valuable. Understanding the intricacies of construction projects can help deliver quality work and\u00a0<a title=\"Business Operations\" href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-operations.html\">manage operations<\/a>\u00a0effectively.<\/p>\n<p>However, business savvy and entrepreneurial expertise are also important. Ideally, your experience is diverse \u2014 from skilled trades to bidding, hiring, and accounting.<\/p>\n<p>You can still launch a successful business venture without this background \u2014 but it will be more challenging and\u00a0<a title=\"Starting a Business: Resources\" href=\"https:\/\/www.findlaw.com\/smallbusiness\/starting-a-business\/starting-a-business-resources.html\">require more support<\/a>.<\/p>\n<p>Running your own business takes grit, even with experience. Working with successful mentors in the construction business can help.<\/p>\n<h3>Seek Out Resources and Support<\/h3>\n<p>Federal government agencies provide tools and resources for the construction and facilities industry. Some of these include:<\/p>\n<ul>\n<li><a title=\"Home Energy Rebates\" href=\"https:\/\/www.energy.gov\/eere\/buildings\/articles\/using-small-business-administration-financing-energy-efficiency-upgrades\" target=\"_blank\" rel=\"noopener\">Energy efficiency<\/a>\u00a0standards and rebates from the Small Business Administration (SBA)<\/li>\n<li><a title=\"Federal Contracting\" href=\"https:\/\/www.sba.gov\/federal-contracting\" target=\"_blank\" rel=\"noopener\">Federal contracting<\/a>\u00a0guides from the Small Business Administration (SBA)<\/li>\n<li>Managing\u00a0<a title=\"Managing Your Hazardous Waste\" href=\"https:\/\/www.epa.gov\/hwgenerators\/managing-your-hazardous-waste-guide-small-businesses\" target=\"_blank\" rel=\"noopener\">hazardous waste<\/a>\u00a0from the Environmental Protection Agency (EPA)<\/li>\n<li><a title=\"Minimum Property Standards\" href=\"https:\/\/www.hud.gov\/program_offices\/housing\/ramh\/mps\/mhsmpsp\" target=\"_blank\" rel=\"noopener\">Minimum property standards<\/a>\u00a0from the Department of Housing and Urban Development (HUD)<\/li>\n<li><a title=\"Office of Manufactured Housing Programs\" href=\"https:\/\/www.hud.gov\/program_offices\/housing\/mhs\" target=\"_blank\" rel=\"noopener\">Manufactured housing programs<\/a>\u00a0from the Department of Housing and Urban Development (HUD)<\/li>\n<li>Protecting homes and businesses\u00a0<a title=\"Mitigation Assistance\" href=\"https:\/\/www.sba.gov\/funding-programs\/disaster-assistance\/mitigation-assistance\" target=\"_blank\" rel=\"noopener\">from natural disasters<\/a>\u00a0from the Small Business Administration (SBA)<\/li>\n<\/ul>\n<p>The SBA also has several tools to help you understand\u00a0<a title=\"Fund Your Business\" href=\"https:\/\/www.sba.gov\/business-guide\/plan-your-business\/fund-your-business\" target=\"_blank\" rel=\"noopener\">startup financing<\/a>.<\/p>\n<p>Your business plan will need a few statistics to justify your financing requests. Find national construction business statistics on the\u00a0<a title=\"About the Construction Sector\" href=\"https:\/\/www.bls.gov\/iag\/tgs\/iag23.htm\" target=\"_blank\" rel=\"noopener\">U.S. Bureau of Labor Statistics<\/a>\u00a0page.<\/p>\n<p>The construction industry has several statistical industry publications, including the\u00a0<a title=\"Construction Industry Data and Statistical Core\" href=\"https:\/\/www.cpwr.com\/research\/current-research\/construction-industry-data-and-statistical-core\/\" target=\"_blank\" rel=\"noopener\">Center for Construction Research and Training<\/a>\u00a0and the\u00a0<a title=\"Marketing Focused on Construction\" href=\"https:\/\/www.constructionmarketingassociation.org\/\" target=\"_blank\" rel=\"noopener\">Construction Marketing Association<\/a>.<\/p>\n<p>Local resources, such as a\u00a0<a title=\"Small Business Development Centers\" href=\"https:\/\/www.sba.gov\/local-assistance\/resource-partners\/small-business-development-centers-sbdc\" target=\"_blank\" rel=\"noopener\">Small Business Development Center<\/a>\u00a0(SBDC), may also be available. These offices can help with business planning, funding resources, and more.<\/p>\n\n                    <\/div>\n                <\/div>\n            <\/div>\n                    <div class=\"steps-container-item\">\n                <div class=\"category-overview category-overview-item-steps\">\n                    <div class=\"category-overview-heading category-overview-heading-steps\">\n                        <div class=\"category-overview-steps\">\n                            2\n                        <\/div>\n                        <h2 class=\"category-overview-steps-title\" id=\"Network\">Network With Suppliers, Other Contractors, and Subcontractors<\/h2>\n                    <\/div>\n                    <div class=\"category-overview-content-steps\">\n                        <p>Find out who is providing construction services in your area. Learn their building designs, reputations, and general business practices. Start with these steps:<\/p>\n<ul>\n<li>Survey the area and observe local construction. Find out who is in the business, what type of buildings are going up, and where. Use that information for&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/starting-a-business\/what-is-a-business-plan-.html\" title=\"What Is a Business Plan?\">your business plan<\/a>. While researching, talk to other builders and learn about the business in your area.<\/li>\n<li>Open accounts with several local suppliers. You should have a&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-finances\/business-accounting.html\" title=\"Business Accounting\">business credit card<\/a>&nbsp;but also establish a credit account with each supplier.<\/li>\n<li>Familiarize yourself with all local&nbsp;<a href=\"https:\/\/www.findlaw.com\/realestate\/land-use-laws\/zoning.html\" title=\"Zoning\">zoning and building ordinances<\/a>. That will give you an idea of what you can build and where.<\/li>\n<li>Create a list of reliable&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/employment-law-and-human-resources\/hiring-independent-contractors-overview.html\" title=\"A Guide to Independent Contractors\">subcontractors<\/a>&nbsp;organized by specialty. Update your list consistently.<\/li>\n<li>Establish good working relationships with&nbsp;<a href=\"https:\/\/www.findlaw.com\/litigation\/filing-a-lawsuit\/can-i-sue-a-code-enforcement-officer--investigator--or-inspector.html\" title=\"Can I Sue a Code Enforcement Officer, Investigator, or Inspector?\">local building inspectors<\/a>. Contact them before you open for business. Tell them you are opening a construction business, and let them know you will comply with all local ordinances and regulations.<\/li>\n<\/ul>\n<p>Ask for help and partnership in your local community.<\/p>\n\n                    <\/div>\n                <\/div>\n            <\/div>\n                    <div class=\"steps-container-item\">\n                <div class=\"category-overview category-overview-item-steps\">\n                    <div class=\"category-overview-heading category-overview-heading-steps\">\n                        <div class=\"category-overview-steps\">\n                            3\n                        <\/div>\n                        <h2 class=\"category-overview-steps-title\" id=\"Determine\">Determine Your Niche<\/h2>\n                    <\/div>\n                    <div class=\"category-overview-content-steps\">\n                        <p>One of your first decisions will be what kind of buildings you want to construct. Consider the following:<\/p>\n<ul>\n<li>Will you build residential housing or commercial buildings?<\/li>\n<li>Will you work primarily in the suburbs or the city?<\/li>\n<li>Will you specialize in new construction or refurbishments?<\/li>\n<\/ul>\n<p>Next, determine which type of contractor you will be:<\/p>\n<ul>\n<li>General contractor who hires others to do various jobs<\/li>\n<li>Subcontractor specializing in one kind of work<\/li>\n<li>General contractor with a permanent staff who hires subcontractors as needed<\/li>\n<\/ul>\n<p>Each business choice requires slightly different bookkeeping, software, and employment and&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-taxes\/business-tax-basics.html\" title=\"Business Tax Basics\">taxation paperwork<\/a>.<\/p>\n<p>Some small-business owners get help&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-lawyer-resources\/how-a-lawyer-can-help-your-business.html\" title=\"How a Lawyer Can Help Your Business\">from an attorney<\/a>&nbsp;for these key decisions.<\/p>\n\n                    <\/div>\n                <\/div>\n            <\/div>\n                    <div class=\"steps-container-item\">\n                <div class=\"category-overview category-overview-item-steps\">\n                    <div class=\"category-overview-heading category-overview-heading-steps\">\n                        <div class=\"category-overview-steps\">\n                            4\n                        <\/div>\n                        <h2 class=\"category-overview-steps-title\" id=\"Pick\">Pick a Business Name and Trademark It<\/h2>\n                    <\/div>\n                    <div class=\"category-overview-content-steps\">\n                        <p>The next step is to&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/starting-a-business\/choosing-your-business-name.html\" title=\"Choosing Your Business Name\">choose a business name<\/a>&nbsp;for your construction business. Your business name should be professional, memorable, and concisely communicate the nature of your business.<\/p>\n<p>Think about how the name&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/starting-a-business\/chronology-choosing-a-business-name.html\" title=\"7 Steps for Choosing a Business Name\">looks and sounds<\/a>&nbsp;when abbreviated. Also, imagine how it will look on your website, vehicles, and other facets of your branding. Once you have selected and registered your name, you may want to work with a graphic designer for a logo.<\/p>\n<p>You cannot choose a business name that is already registered in your state. Search for your desired business name on&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/incorporation-and-legal-structures\/state-guide-corporations-offices.html\" title=\"State Guide: Corporations Offices\">your state&#8217;s corporations website<\/a>, usually a secretary of state. Most states&#8217; sites have a searchable database of registered business names.<\/p>\n<p>Also, confirm your selected name isn&#8217;t protected under a federal trademark. You can use the U.S. Patent and Trademark Office&#8217;s (USPTO)&nbsp;<a href=\"https:\/\/www.uspto.gov\/trademarks\/search\" title=\"Search Our Trademark Database\" target=\"_blank\" rel=\"noopener\">trademark database<\/a>&nbsp;to check for federal trademarks.<\/p>\n<p>Your name also can&#8217;t be&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/intellectual-property\/proving-infringement-confusing-similarity.html\" title=\"Proving Infringement: Confusing Similarity\">confusingly similar<\/a>&nbsp;to a registered <a href=\"https:\/\/www.anrdoezrs.net\/click-100799097-15070889?sid=how-to-open-a-construction-business&#038;auto-aff-trademark-registration\" class=\"diy-biz-affiliate\" rel=\"sponsored noopener\" data-cta=\"Biz Auto LZ - LATL Txt\" data-cta-url=\"legalzoom.com\" target=\"_blank\">trademark<\/a>. This means you cannot use your selected name if the average consumer could mistake your business name for someone else&#8217;s trademark.<\/p>\n<p>Once you have confirmed that your name is available in your state and not protected under a trademark, check to see if the&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/intellectual-property\/registering-for-a-domain-name-trademark-what-you-should-know.html\" title=\"Registering for a Domain Name Trademark\">internet domain name<\/a>&nbsp;is available. If it is available, purchase it immediately. This typically doesn&#8217;t cost more than $15. Don&#8217;t forget to snag social media handles, too.<\/p>\n<p>Next,&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/starting-a-business\/registering-the-name-of-your-business.html\" title=\"How to Register a Business Name\">register your business name<\/a>&nbsp;with your state.<\/p>\n<h3>Trademarking Your Business Name<\/h3>\n<p>Registering your business name with your state does not automatically afford you trademark rights. You must apply for a&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/intellectual-property\/trademarks-and-business-names.html\" title=\"Trademarks and Business Names\">federal trademark with the USPTO<\/a>&nbsp;separately. This process takes time (typically around 18 months), but your name is protected as a&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/intellectual-property\/trademark-protection-by-use-or-by-registration.html\" title=\"Trademark Protection by Use or by Registration\">common law trademark<\/a>&nbsp;during the process.<\/p>\n<p>Once you receive your federal trademark, you can register that trademark&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/intellectual-property\/state-trademark-information.html\" title=\"A Guide to State Trademark Information\">with your state<\/a>. Not all states offer this, and it may not be necessary for your business.<\/p>\n<p>After trademark approval, you are officially the legal owner of your business name. This means you can enforce trademark rights in the&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/intellectual-property\/trademark-infringement-law-q-a.html\" title=\"Trademark Infringement Law FAQ\">event of infringement<\/a>.<\/p>\n\n                    <\/div>\n                <\/div>\n            <\/div>\n                    <div class=\"steps-container-item\">\n                <div class=\"category-overview category-overview-item-steps\">\n                    <div class=\"category-overview-heading category-overview-heading-steps\">\n                        <div class=\"category-overview-steps\">\n                            5\n                        <\/div>\n                        <h2 class=\"category-overview-steps-title\" id=\"Choose\">Choose a Legal Business Structure<\/h2>\n                    <\/div>\n                    <div class=\"category-overview-content-steps\">\n                        <p>You must decide which\u00a0<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/incorporation-and-legal-structures\/types-of-business-structures.html\" title=\"Types of Business Structures\">type of structure<\/a>\u00a0to use for your business. Each type of structure has tax and liability implications, so it is important to research and\u00a0<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/incorporation-and-legal-structures\/business-structures-which-one-is-best-for-your-business.html\" title=\"Business Structures: Which One is Best for Your Business\">choose the best one<\/a>\u00a0for your business. You may want to consult with your attorney about this decision.<\/p>\n<h3>LLCs and Corporations<\/h3>\n<p>Most small startup businesses are\u00a0<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/incorporation-and-legal-structures\/limited-liability-corporation-faq.html\" title=\"Limited Liability Company FAQ\">limited liability companies<\/a>\u00a0(LLCs). LLCs offer tax flexibility and\u00a0<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/incorporation-and-legal-structures\/llc-advantages-and-disadvantages.html\" title=\"LLC Advantages and Disadvantages\">personal liability protection<\/a>, meaning your personal assets are not at risk if your business incurs debt or is sued.<\/p>\n<p>LLCs also\u00a0<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/incorporation-and-legal-structures\/corporation-versus-llc.html\" title=\"Corporation vs. LLC: What Is Best for Your New Business?\">require less paperwork<\/a>\u00a0and are more cost-effective to set up than corporations. Corporations also protect personal assets but have a more formal structure and are subject to\u00a0<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/incorporation-and-legal-structures\/tax-differences-between-c-and-s-corporations.html\" title=\"C Corps and S Corps: Key Tax Differences\">double taxation<\/a>. Larger companies or those who plan to go public tend to structure as corporations.<\/p>\n<p>As your business grows and evolves, you can convert your business from an <a href=\"https:\/\/legalzoomcominc.pxf.io\/c\/4851649\/2115288\/26746?subId1=how-to-open-a-construction-business&#038;auto-aff-llc\" class=\"diy-biz-affiliate\" rel=\"sponsored noopener\" data-cta=\"Biz Auto LZ - LATL Txt\" data-cta-url=\"legalzoom.com\" target=\"_blank\">LLC<\/a> to a corporation if necessary.<\/p>\n<h3>Sole Proprietorships and Partnerships<\/h3>\n<p>With either a sole proprietorship or partnership, the law does not treat the business owner as\u00a0<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/incorporation-and-legal-structures\/do-s-and-don-ts-choosing-a-business-form.html\" title=\"Do&#039;s and Don&#039;ts: Choosing a Business Form\">separate from the business entity<\/a>.<\/p>\n<p>If you are the only owner, you could also structure it as a\u00a0<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/incorporation-and-legal-structures\/sole-proprietorships.html\" title=\"Sole Proprietorships\">sole proprietorship<\/a>. This is the most straightforward type of business structure. If you do not choose another structure, the state will recognize your business as a sole proprietorship by default.<\/p>\n<p>However, operating as a sole proprietorship\u00a0<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/incorporation-and-legal-structures\/what-are-the-disadvantages-of-a-sole-proprietorship.html\" title=\"What Are the Disadvantages of a Sole Proprietorship?\">comes with risks<\/a>. Sole proprietorships do not offer personal liability protection. If someone sues your business or it goes into debt, your assets, like your personal accounts, home, and cars, are all at risk.<\/p>\n<p>A\u00a0<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/incorporation-and-legal-structures\/types-of-partnerships.html\" title=\"Types of Partnerships\">partnership<\/a>\u00a0is like a sole proprietorship but for businesses with more than one owner. A general partnership has tax flexibility but no personal liability protection. However, you could consider a\u00a0<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/incorporation-and-legal-structures\/the-small-business-partnership-general-and-limited-partnerships.html\" title=\"The Small Business Partnership: General and Limited Partnerships\">limited liability partnership<\/a>\u00a0(LLP), which provides limited liability for all partners.<\/p>\n\n                    <\/div>\n                <\/div>\n            <\/div>\n                    <div class=\"steps-container-item\">\n                <div class=\"category-overview category-overview-item-steps\">\n                    <div class=\"category-overview-heading category-overview-heading-steps\">\n                        <div class=\"category-overview-steps\">\n                            6\n                        <\/div>\n                        <h2 class=\"category-overview-steps-title\" id=\"Write\">Write a Business Plan<\/h2>\n                    <\/div>\n                    <div class=\"category-overview-content-steps\">\n                        <p>Every new company needs a solid&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/starting-a-business\/business-plan-outline.html\" title=\"Business Plan Outline\">business plan<\/a>, particularly one in construction, which can cost millions of dollars to start up. In addition, you will need one if you are starting a franchise. A good business plan will include:<\/p>\n<ul>\n<li>Executive summary<\/li>\n<li>Objectives and mission statement<\/li>\n<li>List of inventory needed<\/li>\n<li>Market analysis and competition<\/li>\n<li>Marketing and promotional strategy<\/li>\n<li>Management structure<\/li>\n<li>Financial projections and startup costs<\/li>\n<\/ul>\n<p>You will need to present a sophisticated business plan to any lender to obtain financing.<\/p>\n<h3>The Importance of Your Marketing Plan<\/h3>\n<p>A significant part of your business plan and ongoing budget is your&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-operations\/your-marketing-plan.html\" title=\"Your Marketing Plan\">marketing plan<\/a>. Your market research and target audience information should inform your marketing strategy.<\/p>\n<p>First, identify your&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-operations\/your-target-market.html\" title=\"Your Target Market\">target market<\/a>. Your efforts should aim to market to these specific potential customers. For example, you would market apartment buildings differently than single-family dwellings \u2014 the same with potential business tenants.<\/p>\n<p>Be specific about your market, and then use the channels that reach that market \u2014 both&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-operations\/the-basics-of-marketing-a-small-business.html\" title=\"How To Craft an Effective Marketing Plan\">digital and traditional<\/a>. Consider the following:<\/p>\n<ul>\n<li>A user-friendly,&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-operations\/website-terms-and-conditions.html\" title=\"Website Legal Requirements\">accessible website<\/a>&nbsp;and a&nbsp;<a href=\"https:\/\/www.google.com\/business\/\" title=\"Stand out on Google With a Free Business Profile\" target=\"_blank\" rel=\"noopener\">Google Business Profile<\/a><\/li>\n<li>Social media platforms<\/li>\n<li>Search engine optimization (SEO) strategies<\/li>\n<li>Direct mail, print advertisements, and television and radio placements<\/li>\n<li>Local news coverage and publicity<\/li>\n<li>Getting involved with community events<\/li>\n<li>Word-of-mouth and referral programs<\/li>\n<\/ul>\n<p>If your budget allows, consider hiring a web developer to&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-operations\/build-a-business-website.html\" title=\"Make a Website for Your Business\">build your website<\/a>. Most developers can also train you to manage and update your website yourself.<\/p>\n\n                    <\/div>\n                <\/div>\n            <\/div>\n                    <div class=\"steps-container-item\">\n                <div class=\"category-overview category-overview-item-steps\">\n                    <div class=\"category-overview-heading category-overview-heading-steps\">\n                        <div class=\"category-overview-steps\">\n                            7\n                        <\/div>\n                        <h2 class=\"category-overview-steps-title\" id=\"Sub\">Choose Your Subcontractors<\/h2>\n                    <\/div>\n                    <div class=\"category-overview-content-steps\">\n                        <p>A primary contractor hires subcontractors to perform specific tasks as part of&nbsp;<a href=\"https:\/\/www.findlaw.com\/realestate\/owning-a-home\/home-improvement-contractors.html\" title=\"Home Improvement and Contractors\">a larger project<\/a>. Subcontractors typically specialize in a particular trade, such as:<\/p>\n<ul>\n<li>Electrical work<\/li>\n<li>Plumbing<\/li>\n<li>Heating, Ventilation, and Air Conditioning (HVAC)<\/li>\n<li>Carpentry<\/li>\n<li>Roofing<\/li>\n<\/ul>\n<p>If you are starting small and want to bid on large jobs, you&#8217;ll need a network of subcontractors ready to work. Ensure they are professional,&nbsp;<a href=\"https:\/\/www.findlaw.com\/realestate\/owning-a-home\/home-improvement-contracts.html\" title=\"Home Improvement Contracts\">bondable<\/a>, and reliable \u2014 you will ultimately be responsible for their construction work.<\/p>\n\n                    <\/div>\n                <\/div>\n            <\/div>\n                    <div class=\"steps-container-item\">\n                <div class=\"category-overview category-overview-item-steps\">\n                    <div class=\"category-overview-heading category-overview-heading-steps\">\n                        <div class=\"category-overview-steps\">\n                            8\n                        <\/div>\n                        <h2 class=\"category-overview-steps-title\" id=\"Learn\">Learn About Construction Finance<\/h2>\n                    <\/div>\n                    <div class=\"category-overview-content-steps\">\n                        <p>Starting a construction business requires several\u00a0<a title=\"Start-Up Financing\" href=\"https:\/\/www.findlaw.com\/smallbusiness\/starting-a-business\/start-up-financing.html\">startup expenses<\/a>. You&#8217;ll also need to finance your projects before generating a profit.<\/p>\n<h3>Pay Upfront Expenses<\/h3>\n<p>Before you start, you will need working capital to pay for some or all of the following:<\/p>\n<ul>\n<li>Licenses and permits<\/li>\n<li>Insurance premiums<\/li>\n<li>Marketing and promotional materials (like\u00a0<a title=\"Advertising Considerations for Your Business\" href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-operations\/advertising-considerations-for-your-business.html\">advertising costs<\/a>, branding, and business cards)<\/li>\n<li>Construction equipment and tools<\/li>\n<li>Labor costs<\/li>\n<li>Vehicle expenses<\/li>\n<li>Office space rent<\/li>\n<\/ul>\n<p>Some construction owners have enough personal assets and capital to fund their first project. If not, you will need financing. There are several methods to <a title=\"Sources of Small Business Financing\" href=\"https:\/\/www.findlaw.com\/smallbusiness\/starting-a-business\/sources-of-small-business-financing.html\">secure outside financing<\/a>, most commonly a small business loan through a bank or credit union. You can also try:<\/p>\n<ul>\n<li>Borrowing from\u00a0<a title=\"Getting Money from Family and Friends for a Business\" href=\"https:\/\/www.findlaw.com\/smallbusiness\/starting-a-business\/getting-money-from-family-and-friends-for-a-business.html\">family and friends<\/a><\/li>\n<li>Attracting\u00a0<a title=\"Loans and Investors\" href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-finances\/loans-and-investors.html\">investors<\/a><\/li>\n<li>Qualifying for an\u00a0<a title=\"Types of 7(a) Loans\" href=\"https:\/\/www.sba.gov\/partners\/lenders\/7a-loan-program\/types-7a-loans\" target=\"_blank\" rel=\"noopener\">SBA 7(a) loan<\/a><\/li>\n<li>Taking out a line of credit or credit card (carefully research terms, fees, and interest rates)<\/li>\n<\/ul>\n<p>Also, check if there are\u00a0<a title=\"Grants\" href=\"https:\/\/www.sba.gov\/funding-programs\/grants\" target=\"_blank\" rel=\"noopener\">local or neighborhood grants<\/a>\u00a0available. Some municipalities offer subsidized lending opportunities for specific industries, areas, or business owner demographics.<\/p>\n<h3>Learn About Business Banking<\/h3>\n<p>No matter how you raise your startup capital, you will need an ongoing relationship with local financial institutions.<\/p>\n<p>There are two financing streams in the construction industry:<\/p>\n<ul>\n<li>Money to run the business<\/li>\n<li>Money to fund the construction projects<\/li>\n<\/ul>\n<p>Start by opening a\u00a0<a title=\"Business Accounting\" href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-finances\/business-accounting.html\">business bank account<\/a>\u00a0and obtaining a credit card.<\/p>\n<p>Construction financing works on a unique business model. As a general contractor, you will likely handle\u00a0<a title=\"The Importance of Cash Management\" href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-finances\/the-importance-of-cash-management.html\">substantial financial transactions<\/a>. You are responsible for keeping diligent records so you know how much money is in your accounts and how much should go to your subcontractors.<\/p>\n<p>Either the general contractor or the homeowner will arrange for a\u00a0<a title=\"Construction Loan\" href=\"https:\/\/dictionary.findlaw.com\/definition\/construction-loan.html\" target=\"_blank\" rel=\"noopener\">construction loan<\/a>\u00a0for the actual construction. This loan is paid in percentage chunks at specific periods during construction. One job of a general contractor is to connect the client with a bank for a loan for their project. This is another reason a positive relationship with a local financial institution is essential.<\/p>\n\n                    <\/div>\n                <\/div>\n            <\/div>\n                    <div class=\"steps-container-item\">\n                <div class=\"category-overview category-overview-item-steps\">\n                    <div class=\"category-overview-heading category-overview-heading-steps\">\n                        <div class=\"category-overview-steps\">\n                            9\n                        <\/div>\n                        <h2 class=\"category-overview-steps-title\" id=\"Use\">Use Construction Software<\/h2>\n                    <\/div>\n                    <div class=\"category-overview-content-steps\">\n                        <p>The construction business is unique in how it:<\/p>\n<ul>\n<li>Procures materials<\/li>\n<li>Employs\u00a0<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/employment-law-and-human-resources\/hiring-independent-contractors-vs-employees.html\" title=\"Hiring Independent Contractors vs. Employees\">various categories<\/a>\u00a0of professionals<\/li>\n<li>Handles\u00a0<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-finances\/business-accounting.html\" title=\"Business Accounting\">accounting and bookkeeping<\/a><\/li>\n<\/ul>\n<p>Because of these intricacies, you&#8217;ll want various industry-specific software.<\/p>\n<p>Construction management software\u00a0tracks your projects from start to finish. There are several to choose from. Most are tailored to a specific size of business or project.<\/p>\n<p>Construction accounting software\u00a0tracks project-specific income and finances. They can tell you what percentage of the job is complete, monitor equipment usage, and collaborate with subcontractors&#8217; accounting programs. Construction accounting programs can also do payroll, which can be complicated for construction owners.<\/p>\n<p>Construction bidding software\u00a0saves time, reduces errors, and increases your chances of submitting winning bids. Project bidding can be challenging, especially on public or highly complex buildings. But even on small projects, this software can help you prepare, submit, and win bids. Consider hiring an administrator to assist in bidding on complex projects.<\/p>\n\n                    <\/div>\n                <\/div>\n            <\/div>\n                    <div class=\"steps-container-item\">\n                <div class=\"category-overview category-overview-item-steps\">\n                    <div class=\"category-overview-heading category-overview-heading-steps\">\n                        <div class=\"category-overview-steps\">\n                            10\n                        <\/div>\n                        <h2 class=\"category-overview-steps-title\" id=\"Protect\">Protect Your Brand and Plan for Growth<\/h2>\n                    <\/div>\n                    <div class=\"category-overview-content-steps\">\n                        <p>Creating trust in your brand should be a fundamental part of any startup construction company. Complete every job so that it&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/starting-a-business\/tips-for-a-successful-small-business.html\" title=\"Tips for a Successful Small Business\">encourages future business<\/a>&nbsp;and positive referrals. Be aware that social media, Yelp, and other online review platforms allow feedback (both good and bad) to reach the public before you have a chance to react or respond.<\/p>\n<p>Try to be transparent and informative in every customer conversation. Delays are an unfortunate reality in this business \u2014 be sincere and upfront when this happens, and don&#8217;t shirk responsibility. Keep your focus on finding solutions and providing good service. Also, only take jobs you are&nbsp;<a href=\"https:\/\/www.findlaw.com\/realestate\/owning-a-home\/construction-developer-s-responsibilities.html\" title=\"Construction Developer&#039;s Responsibilities\">equipped to perform<\/a>.<\/p>\n<p>Follow up with every lead and every bid. Construction software will track this for you, but it will be up to you to make final decisions. Conform to the<a href=\"https:\/\/www.findlaw.com\/hirealawyer\/choosing-the-right-lawyer\/construction-law.html\" title=\"What Is Construction Law?\">&nbsp;necessary laws<\/a>, rules, and regulations, and don&#8217;t take shortcuts.<\/p>\n\n                    <\/div>\n                <\/div>\n            <\/div>\n                    <div class=\"steps-container-item\">\n                <div class=\"category-overview category-overview-item-steps\">\n                    <div class=\"category-overview-heading category-overview-heading-steps\">\n                        <div class=\"category-overview-steps\">\n                            11\n                        <\/div>\n                        <h2 class=\"category-overview-steps-title\" id=\"Contracts\">Use Written Contracts Only<\/h2>\n                    <\/div>\n                    <div class=\"category-overview-content-steps\">\n                        <p>Only do business by&nbsp;<a href=\"https:\/\/www.findlaw.com\/realestate\/owning-a-home\/home-improvement-contracts.html\" title=\"Home Improvement Contracts\">written contract<\/a>. Do not make handshake deals, even with friends or family. Your contracts should have clear timelines with contingencies for unexpected delays (like weather or labor difficulties).<\/p>\n<p>Your contracts should also discuss:<\/p>\n<ul>\n<li>Terms of payment<\/li>\n<li>Claims for extra work clause<\/li>\n<li>Estimates on the scope of work<\/li>\n<li>Explicit provisions on the use of subcontractors<\/li>\n<\/ul>\n<p>You may need to include&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-contracts-forms\/contracts-basics.html\" title=\"Contracts Basics\">other information<\/a>&nbsp;depending on the project&#8217;s scope.<\/p>\n<p>Properly drafted contracts can reduce the risk of misunderstandings and legal disputes. A&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-lawyer-resources\/when-do-i-need-a-business-lawyer-for-my-small-business.html\" title=\"When Do I Need a Business Lawyer for My Small Business?\">business attorney<\/a>&nbsp;can advise you on how to draft an effective contract and what to include.<\/p>\n\n                    <\/div>\n                <\/div>\n            <\/div>\n                    <div class=\"steps-container-item\">\n                <div class=\"category-overview category-overview-item-steps\">\n                    <div class=\"category-overview-heading category-overview-heading-steps\">\n                        <div class=\"category-overview-steps\">\n                            12\n                        <\/div>\n                        <h2 class=\"category-overview-steps-title\" id=\"Understand\">Understand the Laws and Rules of the Construction Business<\/h2>\n                    <\/div>\n                    <div class=\"category-overview-content-steps\">\n                        <p>Every construction company is subject to federal, state, and local laws and regulations. These include:<\/p>\n<ul>\n<li>Federal\u00a0<a href=\"https:\/\/www.osha.gov\/laws-regs\" title=\"Law and Regulations\" target=\"_blank\" rel=\"noopener\">OSHA regulations<\/a><\/li>\n<li>Your\u00a0<a href=\"https:\/\/www.osha.gov\/stateplans\" title=\"State Plans\" target=\"_blank\" rel=\"noopener\">state&#8217;s OSHA regulations<\/a><\/li>\n<li>Federal\u00a0<a href=\"https:\/\/www.hud.gov\/program_offices\/housing\/ramh\/mps\/mhsmpsp\" title=\"Minimum Property Standards\" target=\"_blank\" rel=\"noopener\">HUD regulations<\/a><\/li>\n<li>The U.S. Environmental Protection Agency\u00a0<a href=\"https:\/\/www.epa.gov\/laws-regulations\" title=\"EPA Laws &amp; Regulations\" target=\"_blank\" rel=\"noopener\">(EPA) regulations<\/a><\/li>\n<li>And other regulations<\/li>\n<\/ul>\n<p>In addition, you may want to build to\u00a0<a href=\"https:\/\/www.epa.gov\/smartgrowth\/green-building-standards\" title=\"Green Building Standards\" target=\"_blank\" rel=\"noopener\">EPA green building<\/a>\u00a0standards.<\/p>\n<p>The construction industry also has several rules that vary by local municipality. Each state also has precise contractor licensing requirements for construction professionals.<\/p>\n<p>Every construction job requires numerous local construction permits for each phase. The more complex the job, the more permits you may need.<\/p>\n<p>You will also need the usual business permits, including a local\u00a0<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/starting-a-business\/business-licenses-and-permits.html\" title=\"Business Licenses and Permits\">business license<\/a>. You may also need the following:<\/p>\n<ul>\n<li>If you are occupying a building, you must pass fire inspections and receive a certificate of occupancy (CO).<\/li>\n<li>If you are making changes to the structure, you will need the normal construction permits.<\/li>\n<li>Depending on the jurisdiction, you may need a\u00a0<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-taxes\/sales-and-use-tax.html\" title=\"Sales and Use Tax\">sales and use tax permit<\/a>\u00a0or a sign permit.<\/li>\n<\/ul>\n<p>Contact your local Chamber of Commerce or equivalent agency to see what your business needs.<\/p>\n\n                    <\/div>\n                <\/div>\n            <\/div>\n                    <div class=\"steps-container-item\">\n                <div class=\"category-overview category-overview-item-steps\">\n                    <div class=\"category-overview-heading category-overview-heading-steps\">\n                        <div class=\"category-overview-steps\">\n                            13\n                        <\/div>\n                        <h2 class=\"category-overview-steps-title\" id=\"Educate\">Educate Yourself on Government Contracts<\/h2>\n                    <\/div>\n                    <div class=\"category-overview-content-steps\">\n                        <p>The federal government encourages construction companies to take on government work. The U.S. government is a major customer for construction businesses and constantly contracts with local builders nationwide.<\/p>\n<p>To win a government contract, you must complete a formal\u00a0<a href=\"https:\/\/www.sba.gov\/contracting\/getting-started-contractor\/register-government-contracting\" title=\"Basic Requirements\" target=\"_blank\" rel=\"noopener\">registration process<\/a>\u00a0and\u00a0<a href=\"https:\/\/www.sba.gov\/contracting\/what-government-contracting\/overview\" title=\"Contracting Guide\" target=\"_blank\" rel=\"noopener\">qualify as a small business<\/a>.<\/p>\n<p>Beyond that, each department that bids out jobs will have specific rules. Use the\u00a0<a href=\"https:\/\/sba.gov\/business-guide\/grow-your-business\/become-federal-contractor\" title=\"Become a Federal Contractor\" target=\"_blank\" rel=\"noopener\">SBA website&#8217;s Become a Federal Contractor<\/a>\u00a0section to learn more about qualifying as a minority-owned or similar business.<\/p>\n\n                    <\/div>\n                <\/div>\n            <\/div>\n                    <div class=\"steps-container-item\">\n                <div class=\"category-overview category-overview-item-steps\">\n                    <div class=\"category-overview-heading category-overview-heading-steps\">\n                        <div class=\"category-overview-steps\">\n                            14\n                        <\/div>\n                        <h2 class=\"category-overview-steps-title\" id=\"Hire\">Understand Hiring, Employment Law, and Taxation<\/h2>\n                    <\/div>\n                    <div class=\"category-overview-content-steps\">\n                        <p>As a small-business owner, you must adhere to applicable employment and tax laws.<\/p>\n<p>First, get an&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-taxes\/employer-identification-number-ein-faq.html\" title=\"Employer Identification Number (EIN) FAQ\">Employer Identification Number<\/a>&nbsp;(EIN) from the Internal Revenue Service (IRS). This is sometimes called a federal tax ID number. You will need this before paying federal taxes, hiring employees, or opening a business bank account. You can get your EIN instantly and for free on&nbsp;<a href=\"https:\/\/www.irs.gov\/businesses\/small-businesses-self-employed\/apply-for-an-employer-identification-number-ein-online\" title=\"Apply for an Employer Identification Number (EIN)\" target=\"_blank\" rel=\"noopener\">the IRS website<\/a>.<\/p>\n<p>Ensure that all new hires can&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/employment-law-and-human-resources\/employment-eligibility-verification.html\" title=\"Employment Eligibility Verification\">legally work in the U.S.<\/a>, and fill out the proper paperwork&nbsp;<a href=\"https:\/\/www.uscis.gov\/i-9\" title=\"I-9, Employment Eligibility Verification\" target=\"_blank\" rel=\"noopener\">(Form I-9)<\/a>&nbsp;to prove this. The same is true for subcontractors.<\/p>\n<p>You should also perform&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/employment-law-and-human-resources\/performing-an-employee-background-check.html\" title=\"Performing an Employee Background Check\">background checks<\/a>&nbsp;on your new hires and subcontractors.<\/p>\n<p>You are responsible for adequately completing and filing your employment taxes and&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-taxes\/tax-checklist-for-starting-a-small-business.html\" title=\"Tax Checklist for Starting a Small Business\">business taxes<\/a>. However, you can delegate this job to your accountant.<\/p>\n<p>You are responsible for complying with all state and federal&nbsp;<a href=\"https:\/\/www.findlaw.com\/smallbusiness\/employment-law-and-human-resources\/employment-law-resources.html\" title=\"Employment Law Resources\">employment laws<\/a>.<\/p>\n\n                    <\/div>\n                <\/div>\n            <\/div>\n                    <div class=\"steps-container-item\">\n                <div class=\"category-overview category-overview-item-steps\">\n                    <div class=\"category-overview-heading category-overview-heading-steps\">\n                        <div class=\"category-overview-steps\">\n                            15\n                        <\/div>\n                        <h2 class=\"category-overview-steps-title\" id=\"Insurance\">Obtain Business Insurance<\/h2>\n                    <\/div>\n                    <div class=\"category-overview-content-steps\">\n                        <p>You will need <a href=\"https:\/\/www.findlaw.com\/smallbusiness\/starting-a-business\/what-is-business-insurance-.html?fli=latl_biz_howto:diy_biz_ins:txt\">comprehensive&nbsp;business insurance<\/a>&nbsp;for your construction business. An insurance agent can make recommendations, but a few insurance policies to consider include:<\/p>\n<ul>\n<li><a href=\"https:\/\/www.findlaw.com\/smallbusiness\/liability-and-insurance.html\" title=\"Business Liability and Insurance\">General liability insurance<\/a><\/li>\n<li><a href=\"https:\/\/www.findlaw.com\/smallbusiness\/liability-and-insurance\/workers-compensation-overview.html\" title=\"Workers&#039; Compensation Overview\">Workers&#8217; compensation<\/a>&nbsp;insurance (this is mandatory in most states)<\/li>\n<li><a href=\"https:\/\/www.findlaw.com\/consumer\/insurance\/umbrella-insurance-policies.html\" title=\"Umbrella Insurance Policies\">Commercial umbrella<\/a>&nbsp;insurance<\/li>\n<li><a href=\"https:\/\/www.findlaw.com\/injury\/car-accidents\/automobile-insurance-policy-coverage.html\" title=\"Automobile Insurance Policy Coverage\">Automobile insurance<\/a>&nbsp;for each of your vehicles<\/li>\n<li>Construction&nbsp;<a href=\"https:\/\/www.findlaw.com\/consumer\/credit-banking-finance\/what-are-surety-contracts.html\" title=\"What Are Surety Contracts?\">surety bonds<\/a>&nbsp;that guarantee you will finish the job you started (these tend to cost between 0.5% and 2% of the total project cost)<\/li>\n<\/ul>\n<p>Your state may also require you to pay into&nbsp;<a href=\"https:\/\/www.findlaw.com\/employment\/losing-a-job\/unemployment-insurance-overview.html\" title=\"Unemployment Insurance: Overview\">unemployment insurance<\/a>&nbsp;and disability insurance programs.<\/p>\n\n                    <\/div>\n                <\/div>\n            <\/div>\n            <\/div>\n<\/div>\n\n\n\n<h2>Need More Help With Your Construction Business? Talk to an Attorney<\/h2>\n<p>The construction industry is complex. Entrepreneurs in this sector need a firm grasp of the market and confidence in handling contractors, subcontractors, and other legal considerations.<\/p>\n<p>It may be in your best interest to get professional help with the legal aspects of your business. An experienced attorney can provide risk management, review contracts, help resolve disputes, and more. Contact a\u00a0<a href=\"https:\/\/lawyers.findlaw.com\/business-commercial-law\/?fli=dcta\" target=\"_blank\" rel=\"noopener\">business attorney<\/a>\u00a0in your area today to learn how they can support your new construction business.<\/p>\n<p>Another option is using our\u00a0<a href=\"https:\/\/legalzoomcominc.pxf.io\/c\/4851649\/2115288\/26746?subId1=how-to-open-a-construction-business-custom-contentl\" target=\"_blank\" rel=\"noopener\">trusted partner LegalZoom<\/a>\u00a0to handle your business formation filing for $99 plus filing fees.<\/p>\n\n\n<div class=\"was-this-helpful\">\n    <div\n            class=\"was-this-helpful__question-container\"\n            aria-labelledby=\"was-this-helpful__question\"\n            role=\"group\"\n    >\n        <span\n                id=\"was-this-helpful__question\"\n                class=\"was-this-helpful__question fl-text-lg-bold\"\n        >Was this helpful?<\/span>\n        <button\n                class=\"was-this-helpful__button fl-text-sm\"\n                aria-label=\"Yes\"\n                value=\"yes\"\n        >\n            <span class=\"was-this-helpful__button-text fl-text-bold\">Yes<\/span>\n            <i class=\"was-this-helpful__button-icon\">\n                <svg width=\"22\" height=\"22\" viewBox=\"0 0 22 22\" fill=\"none\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\">\n                    <g id=\"thumbs-up\" clip-path=\"url(#clip0_604_3418)\">\n                        <path id=\"Vector\"\n                              d=\"M6 21H3C2.46957 21 1.96086 20.7893 1.58579 20.4142C1.21071 20.0391 1 19.5304 1 19V12C1 11.4696 1.21071 10.9609 1.58579 10.5858C1.96086 10.2107 2.46957 10 3 10H6M13 8V4C13 3.20435 12.6839 2.44129 12.1213 1.87868C11.5587 1.31607 10.7956 1 10 1L6 10V21H17.28C17.7623 21.0055 18.2304 20.8364 18.5979 20.524C18.9654 20.2116 19.2077 19.7769 19.28 19.3L20.66 10.3C20.7035 10.0134 20.6842 9.72068 20.6033 9.44225C20.5225 9.16382 20.3821 8.90629 20.1919 8.68751C20.0016 8.46873 19.7661 8.29393 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id=\"was-this-helpful__radio-button--understandable\"\n                                class=\"fl-radio-button-field-input\"\n                                type=\"radio\"\n                                name=\"positive-feedback\"\n                                value=\"Easy to understand\"\n                        >\n                        <label\n                                class=\"fl-radio-button-field-label fl-text-sm was-this-helpful__radio-label\"\n                                for=\"was-this-helpful__radio-button--understandable\"\n                        >Easy to understand<\/label>\n                    <\/div>\n                    <div class=\"fl-radio-button-field fl-flex was-this-helpful__feedback-form-title\">\n                        <input\n                                id=\"was-this-helpful__radio-button--solved-problem\"\n                                class=\"fl-radio-button-field-input\"\n                                type=\"radio\"\n                                name=\"positive-feedback\"\n                                value=\"Solved my problem\"\n                        >\n                        <label\n                                class=\"fl-radio-button-field-label fl-text-sm was-this-helpful__radio-label\"\n                                for=\"was-this-helpful__radio-button--solved-problem\"\n                        >Solved my problem<\/label>\n                    <\/div>\n                    <div class=\"fl-radio-button-field fl-flex was-this-helpful__feedback-form-title\">\n                        <input\n                                id=\"was-this-helpful__radio-button--other\"\n                                class=\"fl-radio-button-field-input\"\n                                type=\"radio\"\n                                name=\"positive-feedback\"\n                                value=\"Other\"\n                        >\n                        <label\n                                class=\"fl-radio-button-field-label fl-text-sm was-this-helpful__radio-label\"\n                                for=\"was-this-helpful__radio-button--other\"\n                        >Other<\/label>\n                    <\/div>\n                <\/fieldset>\n            <\/div>\n            <div class=\"was-this-helpful__feedback was-this-helpful__feedback--negative\">\n                <fieldset>\n                    <legend class=\"was-this-helpful__feedback-form-title\" tabindex=\"0\">Why was this not helpful?<\/legend>\n                    <div class=\"was-this-helpful__choose-option-message\" role=\"status\">\n                        <p class=\"was-this-helpful__choose-option-message-text\"><\/p>\n                    <\/div>\n                    <div class=\"fl-radio-button-field fl-flex was-this-helpful__feedback-form-title\">\n                        <input\n                                id=\"was-this-helpful__radio-button--missing-info\"\n                                class=\"fl-radio-button-field-input\"\n                                type=\"radio\"\n                                name=\"negative-feedback\"\n                                value=\"Missing Information\"\n                        >\n                        <label\n                                class=\"fl-radio-button-field-label fl-text-sm was-this-helpful__radio-label\"\n                                for=\"was-this-helpful__radio-button--missing-info\"\n                        >Missing the information I need<\/label>\n                    <\/div>\n                    <div class=\"fl-radio-button-field fl-flex was-this-helpful__feedback-form-title\">\n                        <input\n                                id=\"was-this-helpful__radio-button--complicated\"\n                                class=\"fl-radio-button-field-input\"\n                                type=\"radio\"\n                                name=\"negative-feedback\"\n                                value=\"Too complicated\"\n                        >\n                        <label\n                                class=\"fl-radio-button-field-label fl-text-sm was-this-helpful__radio-label\"\n                                for=\"was-this-helpful__radio-button--complicated\"\n                        >Too complicated \/ too many steps<\/label>\n                    <\/div>\n                    <div class=\"fl-radio-button-field fl-flex was-this-helpful__feedback-form-title\">\n                        <input\n                                id=\"was-this-helpful__radio-button--dated\"\n                                class=\"fl-radio-button-field-input\"\n                                type=\"radio\"\n                                name=\"negative-feedback\"\n                                value=\"Out of date\"\n                        >\n                        <label\n                                class=\"fl-radio-button-field-label fl-text-sm was-this-helpful__radio-label\"\n                                for=\"was-this-helpful__radio-button--dated\"\n                        >Out of date<\/label>\n                    <\/div>\n                    <div class=\"fl-radio-button-field fl-flex was-this-helpful__feedback-form-title\">\n                        <input\n                                id=\"was-this-helpful__radio-button--negative-other\"\n                                class=\"fl-radio-button-field-input\"\n                                type=\"radio\"\n                                name=\"negative-feedback\"\n                                value=\"Other\"\n                        >\n                        <label\n                                class=\"fl-radio-button-field-label fl-text-sm was-this-helpful__radio-label\"\n                                for=\"was-this-helpful__radio-button--negative-other\"\n                        >Other<\/label>\n                    <\/div>\n                <\/fieldset>\n            <\/div>\n            <div class=\"was-this-helpful__form-buttons-container\">\n                <button\n                    class=\"was-this-helpful__feedback-button was-this-helpful__feedback-button--positive at-feedback-submit fl-button secondary\"\n                    type=\"submit\"\n                >\n                    <span class=\"fl-button-content\">Submit<\/span>\n                    <i\n                        class=\"fa fa-angle-right medium\"\n                        aria-hidden=\"true\"\n                    ><\/i>\n                <\/button>\n                <button\n                    class=\"was-this-helpful__feedback-button was-this-helpful__feedback-button--cancel fl-button primary disabled\"\n                    type=\"reset\"\n                >\n                    <span class=\"fl-button-content\">Cancel<\/span>\n                    <i\n                        class=\"fa fa-times-circle medium\"\n                        aria-hidden=\"true\"\n                    ><\/i>\n                <\/button>\n            <\/div>\n        <\/form>\n    <\/div>\n    <div class=\"was-this-helpful__thank-you-message\" role=\"status\">\n        <i class=\"was-this-helpful__thank-you-message-icon fa fa-check\"><\/i>\n        <p class=\"was-this-helpful__thank-you-message-text\" aria-live=\"polite\"><\/p>\n    <\/div>\n<\/div>\n<\/div>\n\n\n\n<div class=\" fl-section-sidebar  \"><div class=\"generalCard\">\n            <div class=\"disclaimer--newLegalZoom general-card--newLegalZoom__disclaimer fl-text-sm\">\n            <p>FindLaw will earn a commission if you purchase business formation products through these affiliate links.<\/p>\n        <\/div>\n        <div class=\"general-card general-card--newLegalZoom\">\n        <div class=\"general-card__header\">\n            <div class=\"general-card__header-image-container\">\n                <img decoding=\"async\" loading=\"lazy\" class=\"general-card__header-image--newLegalZoomText\"\n                     src=\"\/wp-content\/themes\/ability-law\/resources\/images\/legal-zoom\/legal_zoom_text.png\"\n                     alt=\"\">\n                <img decoding=\"async\" loading=\"lazy\" class=\"general-card__header-image--newLegalZoom\"\n                     src=\"\/wp-content\/themes\/ability-law\/resources\/images\/legal-zoom\/legal_zoom.png\"\n                     alt=\"\">\n            <\/div>\n            <span class=\"general-card__header-title fl-text\"><p>Meet FindLaw&#8217;s <b>trusted partner LegalZoom<\/b>, an industry leader in online business formations<\/p>\n<\/span>\n        <\/div>\n        <div class=\"general-card__body\">\n            <div class=\"text section\">\n                <div class=\"cmp-text\">\n                    <h2 class=\"general-card__h2--newLegalZoom fl-h3-landing\">Let&#8217;s start your free LLC!<\/h2>\n                    <div>\n                        <\/p>\n<p>Join the millions who launched their businesses with LegalZoom.<\/p>\n<p><b>LLC plans start at $0 + state fees.<\/b><\/p><\/p>\n\n                    <\/div>\n                <\/div>\n            <\/div>\n        <\/div>\n        <div class=\"general-card__footer\">\n            <a class=\"general-card__footer-link fl-text-lg diy-biz-affiliate\" data-cta-url=\"legalzoom.com\" data-cta=\"Biz LZ - StateLaws ESum\" target=\"_blank\" rel=\"sponsored noopener\" href=\"https:\/\/legalzoomcominc.pxf.io\/c\/4851649\/2115288\/26746?subId1=how-to-open-a-construction-business-esum\">\n                <p class=\"general-card__footer-link-text fl-no-margin fl-text-lg-medium\">SELECT AND START LLC<\/p>\n                <i class=\"general-card__footer-link-icon fa fa-angle-right\" aria-hidden=\"true\"><\/i>\n            <\/a>\n        <\/div>\n    <\/div>\n    <div class=\"general-card--newLegalZoom__bottom\">\n        <p>Prefer to work with a lawyer?<\/p>\n<p><a>Find one right now.<\/a><\/p>\n\n    <\/div>\n<\/div>\n\n<div class=\"general-list\">\n    <h3>Helpful Links<\/h3>\n    <ul class=\"fl-list fl-no-margin\">\n                                    <li class=\"fl-list-item fl-flex\">\n                    <i class=\"fa fa-angle-right medium\" aria-hidden=\"true\"><\/i>\n                    <a class=\"fl-list-item-link\" href=\"https:\/\/www.findlaw.com\/smallbusiness\/starting-a-business.html\">\n                        Starting a Business\n                    <\/a>\n                <\/li>\n                                                <li class=\"fl-list-item fl-flex\">\n                    <i class=\"fa fa-angle-right medium\" aria-hidden=\"true\"><\/i>\n                    <a class=\"fl-list-item-link\" href=\"https:\/\/www.findlaw.com\/smallbusiness\/business-taxes.html\">\n                        Business Tax Law\n                    <\/a>\n                <\/li>\n                                                <li class=\"fl-list-item fl-flex\">\n                    <i class=\"fa fa-angle-right medium\" aria-hidden=\"true\"><\/i>\n                    <a class=\"fl-list-item-link\" href=\"https:\/\/www.findlaw.com\/smallbusiness\/closing-a-business.html\">\n                        Closing a Business\n                    <\/a>\n                <\/li>\n                        <\/ul>\n<\/div>\n\n\n    <div class=\"popularDirectory\">\n        <div class=\"general-popular-directory \">\n            <div class=\"general-popular-directory-title\">\n                <h3>Attorney Directory<\/h3>\n            <\/div>\n            <ul>\n                                    <li><a href=\"https:\/\/lawyers.findlaw.com\/business-organizations\/\" target=\"_blank\" rel=\"noopener\">Business Organization Attorneys<\/a><\/li>\n                                    <li><a href=\"https:\/\/lawyers.findlaw.com\/mergers-acquisitions\/\" target=\"_blank\" rel=\"noopener\"> Mergers &#038; Acquisitions Attorneys<\/a><\/li>\n                                    <li><a href=\"https:\/\/lawyers.findlaw.com\/antitrust-trade-regulation\/\" target=\"_blank\" rel=\"noopener\">Antitrust Lawyers<\/a><\/li>\n                                    <li><a href=\"https:\/\/lawyers.findlaw.com\/banking-finance-law\/\" target=\"_blank\" rel=\"noopener\">Banking &#038; Finance Lawyers<\/a><\/li>\n                                    <li><a href=\"https:\/\/lawyers.findlaw.com\/franchising\/\" target=\"_blank\" rel=\"noopener\">Franchising Lawyers<\/a><\/li>\n                                    <li><a href=\"https:\/\/lawyers.findlaw.com\/business-commercial-law\/\" target=\"_blank\" rel=\"noopener\">Business &#038; Commercial Lawyers<\/a><\/li>\n                                    <li><a href=\"https:\/\/lawyers.findlaw.com\/employment-law-employer\/\" target=\"_blank\" rel=\"noopener\">Employment Lawyers<\/a><\/li>\n                            <\/ul>\n        <\/div>\n    <\/div>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Starting a construction business is a complex process. Learn the legal, financial, and business steps to open your own construction company at FindLaw.<\/p>\n","protected":false},"author":41135,"featured_media":0,"parent":5123,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"app\/Http\/Controllers\/Templates\/ArticleDIYConversionController.php","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_autodraft_ids":[],"_cloudinary_featured_overwrite":false,"_sb_is_suggestion_mode":false,"_sb_show_suggestion_boards":false,"_sb_show_comment_boards":false,"_sb_suggestion_history":"","_sb_update_block_changes":"","_is_real_time_mode":false,"_realtime_collaborators":"","footnotes":"","cf_checklist_status":[]},"categories":[2],"tags":[],"state_laws_tags":[],"flmsa":[],"class_list":["post-5288","page","type-page","status-publish","hentry","category-smallbusiness"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.findlaw.com\/law-api\/wp-json\/wp\/v2\/pages\/5288","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.findlaw.com\/law-api\/wp-json\/wp\/v2\/pages"}],"about":[{"href":"https:\/\/www.findlaw.com\/law-api\/wp-json\/wp\/v2\/types\/page"}],"author":[{"embeddable":true,"href":"https:\/\/www.findlaw.com\/law-api\/wp-json\/wp\/v2\/users\/41135"}],"replies":[{"embeddable":true,"href":"https:\/\/www.findlaw.com\/law-api\/wp-json\/wp\/v2\/comments?post=5288"}],"version-history":[{"count":0,"href":"https:\/\/www.findlaw.com\/law-api\/wp-json\/wp\/v2\/pages\/5288\/revisions"}],"up":[{"embeddable":true,"href":"https:\/\/www.findlaw.com\/law-api\/wp-json\/wp\/v2\/pages\/5123"}],"wp:attachment":[{"href":"https:\/\/www.findlaw.com\/law-api\/wp-json\/wp\/v2\/media?parent=5288"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.findlaw.com\/law-api\/wp-json\/wp\/v2\/categories?post=5288"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.findlaw.com\/law-api\/wp-json\/wp\/v2\/tags?post=5288"},{"taxonomy":"state_laws_tags","embeddable":true,"href":"https:\/\/www.findlaw.com\/law-api\/wp-json\/wp\/v2\/state_laws_tags?post=5288"},{"taxonomy":"flmsa","embeddable":true,"href":"https:\/\/www.findlaw.com\/law-api\/wp-json\/wp\/v2\/flmsa?post=5288"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}