Iowa Contractor License Bond$5,000-$25,000 DIAL Required

Iowa requires contractor registration through DIAL for anyone earning $2,000 or more annually from construction. Out-of-state contractors and in-state contractors with employees must post a $25,000 bond. Plumbing/HVAC contractors need a $5,000 bond per Iowa Code 105.19. The bond guarantees payment of taxes and other obligations to the State of Iowa.

Iowa contractor bond costs depend on the bond amount and your credit. For the $25,000 out-of-state bond, expect $250-$750 annually (1-3%) with good credit. The $5,000 plumbing/HVAC bond costs $75-$150 annually. Poor credit may increase rates to 5-10%. Our instant approval system provides competitive rates regardless of credit history.

Any contractor earning $2,000 or more annually from construction must register with DIAL. Exemptions include: those making less than $2,000/year or working only on their own property. Both individual contractors and construction companies must register. Failure to register can result in $500 citations for first violations and up to $5,000 for repeat violations.

Yes, all out-of-state contractors must post a $25,000 bond with DIAL before performing work in Iowa. This bond guarantees payment of taxes, penalties, and other payments due to the State of Iowa. Only the State of Iowa and its agencies may collect on this bond. Having a branch office in Iowa does NOT exempt you from this bonding requirement.

To register: (1) Complete DIAL contractor registration application, (2) Pay $50 registration fee, (3) Purchase required surety bond ($25,000 for out-of-state or with employees; $5,000 for plumbing/HVAC), (4) Submit workers compensation certificate if you have employees, (5) Bond must be on official DIAL form from Iowa-licensed surety. Annual renewal required.

Iowa penalties for unregistered contracting include: $500 citation for first violation, up to $5,000 for repeat violations. The state can also pursue civil penalties and may require you to stop all work until properly registered and bonded. Protect yourself and your business by maintaining current registration and bonding.