Working as a Contractor in Florida: Tax, Licensing and Getting Paid

Florida gives you a real head start with no state income tax, but it still licenses contractors and runs strict deadlines on getting paid, so "no income tax" is not the same as "no rules." Here is what actually changes when you work here.‍‌‌‌‌​​‌​‌‌‌​​​‌‌​​‌‌​‌​‌‌​‌‌‌​‌‌‍

Each section below points to a tool that runs your exact numbers for Florida.

Tax in Florida

Florida has no state income tax, so the only income tax on your trade profit is federal. That means no state return, no state estimated payments, and no state tax to set aside. You still owe federal income tax and self-employment tax and still have to make quarterly federal estimated payments, so do not treat the state tax you are not paying as spare cash.

On sales tax, Florida follows the usual rule for the trades: your labor is not taxed, and you pay sales tax on your materials when you buy them rather than charging it to the customer.

Work out what to hold back on the Tax Set-Aside Calculator, which runs the federal and self-employment numbers for Florida.

Getting paid: liens and retainage

A mechanic's lien is the tool that actually gets a Florida contractor paid, and in Florida you generally have to record it within 90 days of your last day of furnishing. There is usually an earlier notice to send first, so do not wait until the filing deadline to start. Miss it and you lose the lien, so the dates matter.

Enforcing it has its own clock. 1 year from recording. Work out your dates on the Lien Deadline tool, and if they are close, get an attorney to confirm them against the statute (Fla. Stat. §§713.06, 713.08(5), 713.22(1)).

On money held back as retainage, here is where Florida lands:

NOT VERIFIED AS A WHOLE ROW. Fla. Stat. §255.078 and §715.12 are cited, and the public 5% and the private 14-day release each carry their own citation. The private cap and the 12% interest figure carry none, and the row has never been read through as a whole.

• Private work: No statutory cap on private work in Florida. Whatever your contract says governs, so read the withholding clause.
• Public work: 5% of each progress payment made to the contractor.
• Release: Private: 14 days from substantial completion of the entire project.
• Prompt pay: Late private payments carry 12% a year interest. If no written punch list is issued in time, interest starts running 14 days after substantial completion, the certificate of occupancy, or the owner taking possession, whichever comes first.

Check the Retainage Calculator before you sign a contract that holds back more.

There is no Florida retainage letter on this site, and the NOT VERIFIED line above is why. A letter that tells the party holding your money what to hand over only gets written over a row that has been read against the statute in full. The Florida forms below are a different thing: they are the statute's own waiver wording, reproduced, and do not rest on the retainage row.

Free Florida lien waiver forms

Florida sets out the wording of a lien waiver in its own statute. These are reproduced from it rather than reworded, because the wording is the part that carries the legal effect. What a signature costs you differs from state to state, and not every state makes a waiver that departs from the form unenforceable, so read the notes on the form itself before you sign one.

• Florida: Waiver and Release of Lien Upon Progress Payment, for when a stage payment is being released
• Florida: Waiver and Release of Lien Upon Final Payment, for when the final payment is being released

Do you need a license in Florida?

Florida requires a state contractor license to take building work on. The threshold that triggers it: No dollar threshold; it turns on the type of work (certified or registered). Dollar figures appear only in the exemptions. Working unlicensed when your job needs a license is the expensive mistake here. FIVE exemption figures using THREE different boundary words in one section. 489.103 also carries express exemptions for Habitat for Humanity (18), disaster-recovery not-for-profits (19), and Miccosukee and Seminole tribal chickees (24). HB 735 (2021) and HB 1383 (2023) preempted local occupational licensing of construction trades to the state, expiring local licenses issued before 1 Jan 2021. The license comes from Construction Industry Licensing Board, within the Department of Business and Professional Regulation (DBPR). Florida accepts the NASCLA commercial exam, useful if you work across state lines.

Trade licenses for electrical, plumbing and HVAC are usually separate and often required even where a GC license is not. See what applies to your trade on the Contractor License Checker.

Building codes and permits

Florida adopts its building codes statewide, so the rules travel with you across the state. Editions still move, so confirm yours with the building department before you price a job.

• Homes: 2021 (published as the Florida Building Code, Residential, 8th Edition 2023)
• Electrical: 2020 (incorporated into the same 8th Edition, not a freestanding Florida electrical code)
• Energy: 2021, with ASHRAE 90.1-2019 (published as the Florida Building Code, Energy Conservation, 8th Edition 2023)
• Plumbing: 2021 IPC (published as the Florida Building Code, Plumbing, 8th Edition 2023)

Florida runs all four families as volumes of one instrument, the Florida Building Code, adopted by the Florida Building Commission and effective 31 December 2023 for permits filed on or after 1 January 2024. It is numbered by edition rather than by year, so the 8th Edition (2023) carries the 2021 I-Codes and the 2020 NEC; build to the Florida-labeled edition, because that is the amended text with legal force. No county or municipality may adopt a weaker or different edition: the code is deemed adopted statewide without local action, and a local technical amendment must be more stringent, must be filed within 30 days, and lapses at the next triennial update. A 9th Edition is in rulemaking with no effective date set.

Source: Florida Building Commission under s.553.73 F.S.; Fla. Admin. Code R. 61G20-1.001; s.553.73(6) F.S. (statewide effect without local adoption); floridabuilding.org. Read against that source on 2026-08-25.

Check a specific job on the permit tool.

Pay and workers' comp

The minimum wage in Florida is $14.00 an hour. Rises to $15.00 on Sep 30, 2026. That is the floor for anyone you put on the books, and it is worth confirming against the state labor department each year because several states step their rate mid-year. Check a rate on the minimum-wage tool.

On workers' comp, the rule that catches people out in Florida is who has to be covered. Sole proprietors are exempt; corporate officers are included but can elect to exclude themselves. Construction has stricter thresholds than other trades. Get a premium range for your trade on the Workers' Comp Estimator.

If a client will not pay

If a client will not pay, you can sue for up to $8,000 in Florida's County Court, small claims. That covers most unpaid-invoice disputes for a small outfit; a bigger claim goes to regular civil court where you will probably want an attorney. Walk through whether filing is worth it on the Small Claims checker.

The clock runs the other way too: a client generally has 5 years to sue you over the work under a written contract in Florida, with an absolute cutoff 7 years after the job is substantially complete. Work out your exposure on the Warranty & Claim Deadline tool.

Common questions

Does Florida have a state income tax?

No. Florida has no state income tax, so the only income tax on your trade profit is federal. You still owe federal income tax and self-employment tax and still make quarterly federal estimated payments.

Do I need a contractor's license in Florida?

Yes. Florida requires a state contractor license. The threshold: No dollar threshold; it turns on the type of work (certified or registered). Dollar figures appear only in the exemptions. It is issued by Construction Industry Licensing Board, within the Department of Business and Professional Regulation (DBPR).

What is the small claims limit in Florida?

You can sue for up to $8,000 in Florida's County Court, small claims. The filing fee is typically $55 to $300. Larger claims go to regular civil court.

How long do I have to file a mechanic's lien in Florida?

Generally 90 days from your last day of furnishing, and there is usually an earlier notice to send first. Miss it and you lose the lien. Work your own dates out on the Lien Deadline tool.

Are there free Florida contract and payment forms?

Yes. This page links 2 lien waiver forms reproduced from the Florida statute rather than reworded. They are free, there is no sign-up, and you fill one in on screen and download it as a PDF or a Word file.

What is the minimum wage in Florida?

$14.00 an hour in Florida, above the federal $7.25. Several states step their rate mid-year, so confirm it before you set a payroll.

What building code does Florida use?

Florida adopts statewide. Homes: 2021 (published as the Florida Building Code, Residential, 8th Edition 2023). Electrical: 2020 (incorporated into the same 8th Edition, not a freestanding Florida electrical code). Editions move, so confirm yours with the building department before you price a job.

The honest bit

These are the 2026 rules for Florida as they stood when this guide was written, and they change: legislatures move thresholds, deadlines and rates every year. Treat this as general guidance to point you in the right direction, not legal, tax or financial advice. Verify anything you rely on at the source (the IRS, the Florida tax and licensing agencies, and your local building department) or with a professional. Where Florida does something unusual, the detail is called out above rather than glossed over.

Related: Tax Set-Aside Calculator · Mechanic's Lien Deadline · Contractor License Checker · Small Claims checker · Working in Your State

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