Contractor Tax Bond
Usually bonds for Contractor taxes are required on a State level. Some states, like Iowa, require bonds for out-of-state contractors to guarantee they will pay Iowa State Taxes on the work performed by the contractor. Other States, like Arizona, require tax compliance bonds from contractors for various reasons and often include local contractors in addition to out-of-state contractors.
The bond amount will be set by the Obligee (usually the State) that is requiring the bond. Some States have minimum amounts required, or they may calculate the bond required based on the anticipated taxes due for any stated period or for a specific job.
Many contractor or out-of-state contractor tax bond requests are for $25,000.00 or less and are usually approved with just a quick credit check. We also have several markets that will offer approval on these bonds with no credit! All we need is an application completed with basic information. The cost for bonds $10,000.00 and under will usually qualify for a minimum premium ranging from $150.00 to $500.00 annually.
Some states, like Arizona, require a two-year term for the tax bonds. We have multiple instant issue (no credit!) programs for these bonds required by the Arizona Department of Revenue. The most common bond amounts are $2,000.00, $7,000.00, and $17,000.00. We also have multiple instant issue programs available in Iowa up to $25,000.00!
Bond Amount over $10,000.00? No Problem! We have programs for those too! Like most tax bonds, as the bond amount increases, so does the amount information needed to gain approval. Generally, bonds up to $25,000.00 can be approved with just a credit check and bonds over $25,000.00 will require financial statements to be reviewed. Rates start at 1-2% for preferred applicants with strong personal credit and financial statements (if required) but are often rated between 3-5% of the required bond limit. Non-standard rates are also available if necessary.
Call us at 1-888-518-8011 or apply online today!