The rules where you work $17
A first 30 days checklist, everyday forms, licenses, workers’ comp and taxes for Ohio, with a yearly calendar. Instant PDF download.
Buy the packet: $17Digital product, all sales final. Informational only, not legal, financial, tax or business advice.
What Ohio expects from a new trade business
Ohio doesn't license general contractors at the state level, but it licenses five specialty trades. Workers' comp comes from the state fund, not an insurance company. And if you work on one- and two-family homes, your lien clock is shorter than on anything else.
Five licensed trades, and the rest is local
Ohio's Construction Industry Licensing Board issues contractor licenses for five trades: HVAC, refrigeration, electrical, plumbing and hydronics. General contractors, remodelers and handymen aren't on that list. You can't act as or claim to be one of those five without the license, and the attorney general can seek a court order to stop you.
That license appears not to reach houses. The law defines a construction project as one that isn't a residential building, meaning a one-, two- or three-family dwelling and its accessory structures. So the state license appears to be for commercial and larger work. If you're close to the line, ask the board before you bid.
House work gets checked locally. Counties can set rules for licensing electrical and HVAC contractors who don't hold a state license, and cities keep their own power over building rules. A county can also charge a state-licensed contractor a registration fee. So call the building department in each place you plan to work. A construction attorney can read where your work lands.
Source: Ohio R.C. 4740.01 · Ohio R.C. 4740.13 · Ohio R.C. 3781.102 · Ohio Revised Code 3781.06
Who to call: an attorney near you
One employee, and you buy from the state
Ohio is a state-fund state. With one or more employees regularly in the business, you pay premium into the state insurance fund run by the Bureau of Workers' Compensation. The law's exception is qualifying self-insurance, which isn't where a small shop starts.
The trap is calling a helper a sub. On a construction contract, a person counts as your employee if at least ten of the statute's listed factors apply, like taking your instructions, being paid and supervised by you, or being required to do the work personally. A 1099 doesn't settle it.
Sole proprietors and partners are outside coverage unless they elect in by written notice to the bureau. An individual incorporated as a corporation is excluded too. Ask the bureau how your LLC is classified. If you're required to cover people and don't, you can be sued for injuries and lose your usual defenses.
Source: Ohio R.C. 4123.01 · Ohio R.C. 4123.35 · Ohio R.C. 4123.77
Who to call: an insurance agent near you
Getting paid: 60 days on homes, 75 on the rest
Your lien affidavit gets filed with the county recorder, counted from the last day you worked or furnished material. It has to state your first and last dates of work.
- 60 days on a one- or two-family home or a residential condo unit, whoever lives there.
- 75 days on most other jobs. Public jobs run on a separate affidavit, within 120 days. A separate 120-day period also covers liens under R.C. 1311.021.
- Serve a copy on the owner within 30 days after you file.
If you're a sub or supplier and a notice of commencement is recorded, serve a notice of furnishing within 21 days of first working. Late notice only protects the 21 days before it. No recorded notice of commencement, no notice of furnishing needed. Sent by certified mail, it counts on the day you mail it.
Home construction contracts are a different test: a home the owner uses as a personal residence. A rental duplex gets the 60 days but not these rules. They skip the notice of commencement and furnishing, unless a lender requires the first. An owner who has paid the original contractor in full cuts off sub and supplier liens, and the original contractor gives the lender an affidavit before getting paid.
A lien lasts 6 years from filing. If the owner serves a notice to commence suit, you have 60 days or it's void. A construction attorney can set this up once.
Source: Ohio R.C. 1311.06 · Ohio R.C. 1311.05 · Ohio R.C. 1311.011 · Ohio R.C. 1311.07 · Ohio R.C. 1311.11 · Ohio R.C. 1311.13 · Ohio Revised Code 1311.04 · Ohio Revised Code 1311.19 · Ohio Revised Code 1311.26
Who to call: an attorney near you
Built in: you're the consumer. A few jobs flip it
On a construction contract, where materials become part of real property, Ohio says you're the consumer. It doesn't matter if it's new work or an addition or alteration, or if you're the prime or the sub. You pay the tax on materials and work it into your price.
Ohio then carves out work that's never a construction contract, and it gets you if you assume otherwise:
- Sale and installation of carpet.
- Landscaping and lawn care, which is itself a taxable service.
- Business fixtures, permanently attached items that mainly benefit the business on site, count as a sale.
Building maintenance and janitorial service, including exterior cleaning, is on the taxable list too. If you do any of these, you collect tax from your customer. A CPA who works with contractors can sort out your mix.
Source: Ohio R.C. 5739.01 · Ohio Adm. Code 5703-9-14
Who to call: a CPA or tax pro near you
A $99 LLC and no annual report
Ohio is one of the cheaper places to form an LLC. $99 to the Secretary of State, and no annual report after that. The Commercial Activity Tax only reaches gross receipts over $6 million, so it won't be your problem any time soon.
The income tax is where Ohio gets interesting. Business income gets its own treatment: the first $250,000 is deducted for most filers, and what's left is taxed at a flat 3%. Other income is taxed at 2.75% over $26,050, for 2026 and after.
That changes the S-corp math, since it's a numbers question to begin with. Bring your books to a CPA who works with contractors in Ohio and ask them to run it.
Source: Ohio R.C. 5747.02 · Ohio R.C. 5747.01
Who to call: a CPA or tax pro near you
Education, not legal or tax advice. Rules change. Confirm anything here with a licensed pro in Ohio before you rely on it. Last updated November 2026.