Business & LicensingQuestion 677 of 690
When a sole proprietor licensed contractor incorporates the business and wants the new corporation to hold the license:
a.The corporation can simply use the sole proprietor's existing license number after filing articles of incorporation
b.The CSLB will automatically transfer the license upon receiving the new EIN
c.The corporation must file a NEW license application as a separate legal entity under Bus. & Prof. Code §7065, including its own bond, qualifier, and workers' compensation certificate; the sole-proprietor license cannot be assigned to the corporation under §7075.1
d.The corporation must wait 12 months after incorporation before applying
Explanation
Bus. & Prof. Code §7075.1 expressly prohibits the transfer or assignment of a contractor's license between separate legal entities. When a sole proprietor incorporates, the corporation is a new legal person and must file its own application under §7065, post its own $25,000 contractor bond (and BQI if applicable), and provide its own workers' comp certificate. The sole proprietor may continue to qualify the corporation as RMO without re-examination (under §7065.1's waiver if the same qualifier is used within the prior five years). There is no 12-month waiting period; automatic transfer is not permitted.
Law Reference: Bus. & Prof. Code §7065Practice all 690 questions free — no signup required.
Related questions on this topic
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