Does GC need an alarm license October 22, 2026

KEN KIRSCHENBAUM, ESQ
ALARM - SECURITY INDUSTRY LEGAL EMAIL NEWSLETTER / THE ALARM EXCHANGE
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Does GC need an alarm license
October 22, 2026
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Comments on Does GC need an alarm license from article on October 5, 2026
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Ken
   In all the states we work in up and down east coast the person installing the alarm system has to have a license to. GC does not have to have a license however, the GC cannot hold themselves out as being a representative about that company who is licensed.
Mike Ski
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Ken,
   Another point of contention in Florida is if an out of state Alarm contractor wants to subcontract a Florida licensed contractor to do work on a customer’s system, the out of state contractor must be licensed in the state of Florida to even contract the work. I see this time and time again, where corporate level companies call to see if we will give them a price for work on one of their large nationwide accounts. The first question I ask is, “Are you licensed in Florida”? Most times, the answer is no, so I educate them.
Best Regards,
Isaac “Ike” Hayden, President
Dynamic Security Professionals, Inc.
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Ken,
   I am reading Anon’s post on October 5th regarding licensure requirements for General Contractors performing alarm work. I don’t mean to sound like a broken record but we are the folks that company owners call when the sales tax guys come after them. There are two components to the tax, Sales Tax and Use Tax. Which of the two Anon’s company may (or may not) be subject to, depend on several factors including the state, the type of work, and the customer.
   We are now representing 21 companies who are going through sales and use tax audits in various states. Some relied on the urban legend that “as long as you pay tax on the materials you are good,” and are finding out the hard way that this generality is not always true. One is finding out that they over $100,000 in tax on installation labor that they should have collected from their customers. In these cases the best that we can do is to try to get the penalties waived and beg for a discount on the taxes if they can pay promptly.
   Most CPAs have no idea what an alarm company actually does, and aren’t familiar with the special rules governing alarm installation, service, and monitoring in many states. Anon may have stepped into a responsibility to collect tax on the services that he resells. His customers may have created a problem for themselves if they assumed that Anon was going to collect the tax.
   It is complicated, make sure that your CPA understands the tax code for your state and understand what you do. If not, call us.
Mitch Reitman
817 698 9999 x 101
Reitman Consulting Group
Fort Worth, TX
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Response
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   When it comes to alarm licensing if you follow a few rules, or ideas, I have promoted, ad nauseum some would say, is 1) do no work without a contract and 2) if you’re contracting for the installation or service you must have the license required in that state. it’s not enough that your subcontractor has it or that you are licensed and hiring an unlicensed subcontractor
   When it comes to alarm licensing if you follow a few rules, or ideas, I have promoted, ad nauseum some would say, that: 1) do no work without a contract and 2) if you’re contracting for the installation or service you must have the license required in that state. it’s not enough that your subcontractor has it or that you are licensed and hiring an unlicensed subcontractor. This rule does apply to a General Contractor and some states may have specific laws pertaining to alarm work. Texas comes to mind.
Texas has a specific exception permitting an unlicensed general contractor or intermediary to contract for regulated alarm work when the work is performed exclusively by a licensed subcontractor. It is not authority for a licensed alarm company to use an unlicensed subcontractor to perform regulated work.
   Under 37 Texas Administrative Code § 35.171, the arrangement is permitted only if:
The proposal, advertising, and contract clearly and conspicuously state that the general contractor or intermediary is not licensed to perform the regulated service and that the service will be provided exclusively by a licensed party;
The contract, bid, or offer identifies the licensed subcontractor by name and license number;
1. The licensed subcontractor is an express party to the contract; and
2. The contract clearly and conspicuously states that the licensee is fully responsible for the regulated service and that the unlicensed general contractor will have no involvement in that service.
   Texas recognizes the unlicensed prime/general contractor–licensed alarm subcontractor model, subject to strict contract requirements. It does not appear to authorize the reverse—having a licensed contracting company retain an unlicensed independent subcontractor to perform regulated alarm services. Texas DPS also states generally that it may take action against persons performing private-security services without the required license.
Texas DPS overview 37 Tex. Admin. Code § 35.171
   This stands out because the statute addresses alarm work, but likely all states permit the GC to engage the licensed alarm contractor to do alarm installation and services. What I am confident would be the law in all states, a GC cannot hold itself out as an alarm contractor and then hire a licensed subcontractor to do the alarm work. A GC’s website, for example, should not claim that the GC is an alarm company, and I would really need to dig deep to opine on whether a GC can contract for just an alarm job and then hire a licensed subcontractor. It seems to me that the job needs to involve construction and improvement of real property and involve several trades to accomplish that work.
   Mitch introduces yet another ubiquitous headache, sales taxes. I suppose if a contractor doesn’t know it should be licensed it may not know what taxes need to collected and/or paid. Ironically it also occurs to me that a contractor who isn’t concerned with licensing may not be concerned with taxes. Someone has to keep us accountants and lawyers in business.
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Ken Kirschenbaum,Esq
Kirschenbaum & Kirschenbaum PC
Attorneys at Law
200 Garden City Plaza
Garden City, NY 11530
516 747 6700 x 301
ken@kirschenbaumesq.com
www.KirschenbaumEsq.com