New Mexico Contractor License Exam — All Questions
422 questions
Which body licenses and regulates contractors in New Mexico?
- a.Each county's building department, with no state agency
- b.The Construction Industries Division (CID) of the Regulation and Licensing Department✓
- c.The New Mexico Taxation and Revenue Department
- d.The New Mexico Secretary of State
New Mexico licenses contractors through the Construction Industries Division (CID) of the Regulation and Licensing Department (RLD), under the Construction Industries Licensing Act (NMSA Chapter 60, Article 13). Licensing and code enforcement are statewide.NMSA Ch. 60, Art. 13 (Construction Industries Licensing Act)
In New Mexico, the individual who supplies the required experience and passes the examinations on behalf of a contracting business is called the:
- a.Responsible Managing Employee
- b.Designated notary
- c.Qualifying Party (QP)✓
- d.Registered agent
New Mexico ties each license to a Qualifying Party (QP) — an individual with the required experience who passes the exams and is responsible for the licensee's construction operations. Without a QP, the license cannot be issued or maintained.NMSA Ch. 60, Art. 13; NMAC 14.6
What score is required to pass New Mexico's contractor Business and Law examination?
- a.80% (40 of 50)
- b.A simple majority of questions
- c.70% (35 of 50)
- d.75% (38 of 50)✓
New Mexico requires 75% to pass its Business and Law exam, which is 38 of the 50 questions. This is a higher bar than the 70% used by many states, so candidates should aim comfortably above the minimum.CID examination specifications
How is the New Mexico contractor Business and Law examination administered with respect to references, and how long is it?
- a.Closed book, 80 questions, 240 minutes
- b.Open book, 50 questions, 130 minutes✓
- c.Closed book, 50 questions, 90 minutes
- d.Oral interview before the division
The New Mexico Business and Law exam is open book, 50 questions, with a 130-minute time limit and a 75% passing score. Candidates may bring the allowed references, but the New Mexico code controls on any conflict.CID examination format
A candidate has passed the NASCLA Accredited Commercial General Building Contractor exam and wants a New Mexico GB-98 license. How does New Mexico treat that NASCLA result for the trade requirement?
- a.New Mexico does not accept NASCLA for the trade requirement; the candidate must pass the New Mexico GB-98/GB-2 exam, though the NASCLA guide may be used as an open-book reference✓
- b.NASCLA is accepted only for electrical classifications
- c.NASCLA waives both the trade and the business/law exams
- d.NASCLA fully satisfies the New Mexico trade exam
New Mexico does not accept the NASCLA exam in place of its own trade exam. The candidate must pass New Mexico's GB-98 or GB-2 examination. The NASCLA guide may be brought in only as one of the allowed open-book references.CID trade examination policy
Which classifications does New Mexico use for a general building contractor?
- a.Residential-Basic and Residential-Light-Commercial
- b.GB-98 (general building) and GB-2 (general building, narrower scope)✓
- c.Groups I through V
- d.Class A and Class B only
New Mexico classifies general building contractors as GB-98 (the broad general building classification) and GB-2 (a narrower general building scope). The candidate takes the trade exam for the classification sought.NMSA Ch. 60, Art. 13 (classifications)
To obtain a New Mexico general building license, within what general timeframe must a candidate pass both the Business and Law exam and the required trade exam?
- a.Both must be passed within a set period, generally one year✓
- b.The trade exam must be passed ten years before the law exam
- c.Only one of the two exams is ever required
- d.There is no time relationship between the two exams
New Mexico expects a candidate to complete both the Business and Law exam and the trade exam within a set period, generally one year, so that the qualifications are current when the license is issued.CID licensing procedure
On an open-book New Mexico exam question, a national reference book conflicts with the New Mexico Construction Industries Licensing Act. Which controls?
- a.Neither; the question is thrown out
- b.Whichever the candidate prefers
- c.The New Mexico code and Construction Industries Licensing Act control✓
- d.The national reference always controls
Even though the exam is open book and national references such as the NASCLA guide are allowed, the New Mexico code and Construction Industries Licensing Act govern on any conflict. Candidates should answer New Mexico questions from the New Mexico rules.NMAC 14.6 (open-book references)
A New Mexico contracting company's Qualifying Party resigns. What is the effect on the company's license?
- a.Nothing changes; the company keeps contracting indefinitely
- b.The license converts to an owner-builder permit
- c.Every field employee automatically becomes a QP
- d.The company must qualify a new Qualifying Party, because the license depends on having a QP✓
Because a New Mexico license is held through its Qualifying Party, the departure of the QP requires the company to designate and qualify a new one. The QP carries the experience and examination that support the license.NMSA Ch. 60, Art. 13 (Qualifying Party responsibility)
An unlicensed operator performs contracting work in New Mexico and then sues the owner for payment. Under NMSA §60-13-30, what is the result?
- a.The operator cannot bring or maintain an action in any court to collect compensation for the work✓
- b.The operator may collect materials costs only
- c.The owner owes the contract price plus a bonus penalty
- d.The operator may collect the full contract price
NMSA §60-13-30 bars a person who was not a duly licensed contractor when contracting from bringing or maintaining any court action to collect compensation for the work. The loss of the right to sue for payment is New Mexico's strongest civil deterrent to unlicensed contracting.NMSA §60-13-30
Under the Construction Industries Licensing Act, when is a license required to perform construction work in New Mexico?
- a.Never; New Mexico registers but does not license contractors
- b.A license is required to engage in contracting, subject only to limited statutory exemptions✓
- c.Only for projects over $500,000
- d.Only for projects owned by the state
The Construction Industries Licensing Act requires a license to engage in contracting in New Mexico, with only limited statutory exemptions. Licensure is the gateway requirement, and unlicensed contracting carries penalties and the loss of the right to sue for payment.NMSA Ch. 60, Art. 13 (licensing requirement)
Under NMSA §48-2-6, within what time after completion must an original (general) contractor file a claim of lien in New Mexico?
- a.Within 10 days
- b.Within two years
- c.Within 120 days✓
- d.Within 30 days
New Mexico's lien statute gives an original contractor 120 days after completion to file the claim of lien, while other claimants such as subcontractors and suppliers must file within 90 days. Missing the deadline defeats the lien.NMSA §48-2-6
A subcontractor in New Mexico wants to preserve lien rights. Within what time after completion must the subcontractor file the claim of lien?
- a.Within one year
- b.Within 90 days✓
- c.Within 30 days
- d.Within 120 days, the same as an original contractor
Under NMSA §48-2-6, claimants other than the original contractor — including subcontractors, laborers, and suppliers — must file the claim of lien within 90 days after completion. The original contractor has the longer 120-day window.NMSA §48-2-6 (subcontractor deadline)
Instead of a conventional sales tax, New Mexico imposes which tax that applies to a contractor's business receipts?
- a.A federal construction excise tax
- b.A flat 5% statewide sales tax collected only from homeowners
- c.No transaction tax of any kind
- d.The Gross Receipts Tax (GRT), reported through a state business tax account✓
New Mexico levies a Gross Receipts Tax (GRT) under NMSA Chapter 7 rather than a conventional sales tax. Contractors register for a state business tax account and report GRT on their gross receipts at the state-plus-local rate for the job location.NMSA Ch. 7 (Gross Receipts Tax)
Beyond losing the right to sue for payment, how is unlicensed contracting generally treated under the New Mexico Construction Industries Licensing Act?
- a.As a violation subject to penalties, including misdemeanor prosecution✓
- b.As a purely private matter with no penalty
- c.As a federal offense enforced by OSHA
- d.As grounds for an automatic license
The Construction Industries Licensing Act treats unlicensed contracting as a violation subject to penalties, including misdemeanor prosecution under NMSA §60-13-52. This is in addition to the §60-13-30 bar on bringing an action to collect.NMSA §60-13-52 (unlicensed practice)
After recording a valid claim of lien in New Mexico, within what general period must the claimant bring an action to enforce (foreclose) the lien?
- a.Within ten years
- b.Within 30 days
- c.Within two years✓
- d.There is no deadline to foreclose
New Mexico generally requires the lien claimant to bring suit to enforce the lien within two years after recording the claim of lien. If no action is filed within that period, the lien expires.NMSA §48-2 (lien enforcement)
Why does New Mexico's licensing law matter to a contractor's ability to be paid and to file a lien?
- a.It has no effect on payment or lien rights
- b.Because an unlicensed contractor cannot sue to collect, unlicensed status undermines both ordinary collection and reliance on the courts to enforce a claim✓
- c.It only changes the filing fee for a lien
- d.It merely speeds permit approval
Because NMSA §60-13-30 bars an unlicensed contractor from bringing an action to collect compensation, unlicensed status leaves the contractor unable to use the courts to enforce payment or, practically, a lien claim. Licensure is a precondition to New Mexico's collection tools.NMSA Ch. 60, Art. 13 (owner protections)
What license bond amount does New Mexico generally require a licensed contractor to maintain?
- a.$50,000
- b.$10,000✓
- c.$2,500
- d.No bond is required
New Mexico generally requires a licensed contractor to file and maintain a $10,000 license bond with the Construction Industries Division. The bond protects the public and the state against violations of the licensing law and must be kept current.NMSA Ch. 60, Art. 13; NMAC 14.6 (license bond)
Under New Mexico's Workers' Compensation Act, an employer generally must carry workers' compensation coverage once it regularly employs how many workers?
- a.Five or more
- b.Ten or more
- c.Coverage is never required for contractors
- d.Three or more✓
New Mexico generally requires workers' compensation coverage for employers that regularly employ three or more workers. Construction employers should confirm their obligation with the Workers' Compensation Administration, since a growing crew can cross the threshold quickly.New Mexico Workers' Compensation Act
Which statement about the New Mexico Business and Law exam is correct?
- a.It is an untimed take-home essay
- b.It is open book, 50 questions, 130 minutes, and requires 75% to pass✓
- c.It is closed book and requires only 60% to pass
- d.It is waived for anyone who holds any out-of-state license
The New Mexico Business and Law exam is open book, 50 questions, 130 minutes, with a 75% (38 of 50) passing score. Candidates may bring the allowed references but should answer New Mexico questions from the New Mexico code.CID examination format
In addition to passing the Business and Law exam, what must a New Mexico general building applicant complete to be licensed?
- a.Pass the New Mexico bar examination
- b.Only pay a fee; no other exam or experience is required
- c.Retake the NASCLA exam every year
- d.Meet the experience requirement and pass the New Mexico trade exam (GB-98 or GB-2) for the classification, through a Qualifying Party✓
A New Mexico general building applicant must, through a Qualifying Party, meet the experience requirement and pass both the Business and Law exam and the New Mexico trade examination (GB-98 or GB-2) for the classification sought. NASCLA does not substitute for the trade exam.NMSA Ch. 60, Art. 13 (experience and exams)
Before doing business in New Mexico, a contractor should register for which state tax account?
- a.No account, because construction is exempt from all New Mexico taxes
- b.A federal-only excise account with the IRS
- c.A state business tax account to report Gross Receipts Tax on its receipts✓
- d.A retail sales tax permit, because New Mexico's sales tax is 8%
Because New Mexico taxes business receipts through the Gross Receipts Tax (NMSA Chapter 7) rather than a sales tax, a contractor must register for a state business tax account and report GRT on its gross receipts. This is a routine but essential compliance step.NMSA Ch. 7 (business tax registration)