NYC Home Improvement Contractor Exam (100+ Qs) – Study Guide with Verified Answers | Laws, Permits, Contracts, Licensing | 2025/2026 | New York City

NYC Home Improvement Contractor Exam (100+ Qs) – Study Guide with Verified Answers | Laws, Permits, Contracts, Licensing | 2025/2026 | New York City Subcontractor Licensing - ANSWER -A subcontractor must have a DCA license to perform home improvement work in New York City. Contract Attachment Requirement - ANSWER -The contractor or sales person must attach two copies of a separate completed form titled 'Notice of Cancellation' to the signed contract. Employee Obligations - ANSWER -You must cover employees with workers' compensation and disability insurance. Employee wages reporting - ANSWER -Must report employee wages to the Internal Revenue Service, and you must withhold taxes. Penalties for false representation - ANSWER -A contractor or sales person who lies is subject to fines of up to 500 dollars for each separate misrepresentation; additionally, a contract entered into after misrepresentation may be declared null and void, and a contractor may be ordered to pay restitution to the consumer. Penalties for operating without a license - ANSWER -Any person who owns or operates a home improvement business without a license or after a license is suspended or revoked is guilty of a misdemeanor and may be prosecuted criminally and subject to up to six months imprisonment or $1000 in fines. Home improvement definition - ANSWER -The construction, repair, replacement, remodeling, alteration, conversion, rehabilitation, renovation, modernization, improvement, or addition to any land or building or any part of the land or building used or designed to be used as a residence or dwelling place, including basements, driveways, fences, garages, landscaping, patios, porches, sidewalks, swimming pools, and terraces. Home improvement contract - ANSWER -A 'home improvement contract' is an agreement, whether or not in writing, between a contractor and a consumer or tenant for performance of a home improvement and includes all labor, services, and materials to be furnished and performed. Employee legal authority - ANSWER -You must comply with the Federal Immigration laws, which require employers to ensure that employees have legal authority to work in the United States. Additional penalty for unlicensed business - ANSWER -A person may be prosecuted civilly and face fines of up to $100 per day for engaging in unlicensed activity or aiding and abetting the operation of an unlicensed person or business. Painting exterior of a house - ANSWER -You may require a suspended scaffold and a rigging permit from DOB to paint the exterior of a home that is one story or more, unless you can use a ladder to do the job. Net profit of a job - ANSWER -Net profit is the final profit of any job after expenses. What is NOT home improvement - ANSWER -Construction of a new home or building; Sale of goods or materials in connection with the installation of or application of goods or materials; Work performed on a residence owned or controlled by the state or municipality; Painting or decoration of a building, residence, home, or apartment, when not related to home improvement work. Difference between subcontractor and employee - ANSWER -A subcontractor is an individual in business for himself or a firm in business for itself contracting to do part of a home improvement contract with a prime contractor. An employee works for wages and is under the employer's (prime or subcontractor) direct supervision and control. Consumer contract cancellation - ANSWER -Within 10 business days refund all payments made under the contract, cancel and return money paid in connection with the contract, terminate any security interest, and notify the consumer as to whether the contractor intends to repossess or abandon any shipped delivered materials. Class One Self Hauler Registration - ANSWER -If you plan to haul or transport waste resulting from your business operations, you must obtain a Class One Self Hauler Registration from the New York City Business Integrity Commission. Capital Improvement Exclusions - ANSWER -Repairs such as repairing a window frame or painting the living room do not qualify as capital improvement. Capital Improvement Example - ANSWER -Adding a bathroom to a home is an example of a capital improvement. Contractor's First Step for Extension - ANSWER -The first thing a contractor should do before beginning work on a home is to consult with a licensed architect or engineer to determine if the owner can put in the extension and still comply with the applicable zoning law. Dumpster Permit - ANSWER -A Contractor should contact the DOT for a dumpster permit. Permit for Addition or Alteration - ANSWER -A contractor secures all necessary permits from the New York City Department of Buildings (DOB). A contractor must make sure that any addition or alterations meet building code standards and do not violate local zoning laws. HIC License Posting - ANSWER -You must post your license in your office where all consumers can see it or show it to consumers upon request. Salesperson Definition - ANSWER -A salesperson is someone who negotiates a home improvement contract with a consumer or tenant, or solicits a home improvement contract from an owner or tenant. Contractor Definition - ANSWER -A contractor is anyone who owns, operates, maintains, conducts, controls, or transacts a home improvement business and undertakes or agrees to perform any home improvement. DCA License Requirement - ANSWER -Any person who solicits, canvasses, sells, performs, or obtains a home improvement contract as a contractor or salesperson must have a DCA license. Permit Responsibility - ANSWER -It is the duty and obligation of the prime contractor to secure all necessary permits, licenses, and Certificates of Occupancy or special exceptions in accordance with applicable state or local building laws.