Florida Building Contractor Business/Finance Practice Exam

Under which condition does a contractor not need to be licensed?

1. If the project is sponsored by a government agency

2. If the work is on a minor project and not compensated

3. If it is for a close relative

4. If the total project cost is less than $500

The correct answer is: If the work is on a minor project and not compensated

A contractor does not need to be licensed when the work is on a minor project and not compensated. This condition typically applies to situations where the work involved is deemed to be of such a limited nature that requiring a license would be unnecessary. For example, small tasks that fall under this category might include simple repairs or maintenance work that doesn't involve significant risk or complexity. It aligns with the idea that minor, voluntary projects performed without payment often do not require the regulatory oversight that licensing provides. In contrast, other scenarios like government-sponsored projects or work done for close relatives may still require licensing due to the nature of contractual agreements or liability concerns. Similarly, the stipulation regarding project cost under $500 typically refers to exemptions that vary by state and often require a licensed contractor nonetheless for safety and regulatory compliance. Thus, option B is the most accurate in the context given.