HVAC Business Setup

• Business structure decision framework (LLC vs. sole prop vs. S-Corp — non-legal framing)
• State formation coordination checklist with step-by-step filing guidance
• EIN acquisition walkthrough and documentation
• Business banking setup — account types, separation requirements, initial funding
• Payment acceptance setup — credit cards, ACH, checks for residential and commercial jobs

• QuickBooks Online setup with HVAC-specific chart of accounts (not the default template)
• Income categories: installs, service/repair, maintenance agreements, add-on sales
• Job costing enabled — per-job tracking for installs, batched tracking for service calls
• Expense categorization: equipment, parts, refrigerant, labor, subs, overhead
• Invoicing structure: standard terms, deposit requirements, maintenance agreement billing
• AR aging tracker and weekly cash review habit installed

• Weekly owner meeting agenda (15–30 min — revenue, margins, cash, pipeline review)
• Simple KPI scoreboard: Revenue / Install Margin / Service Margin / Cash Position
• Role clarity one-pager for each active role (tech, office, owner-operator)
• One SOP template per critical process identified during engagement
• 90-day maintenance guide — what to review weekly and monthly
• Handoff package: complete documentation, all credentials organized

What business structure is best for an HVAC company?

Most new HVAC companies start as a single-member LLC. An LLC provides personal liability protection — critical when you're working in homes, dealing with gas lines, refrigerant, and electrical systems. If you have a business partner, a multi-member LLC with a proper operating agreement is the standard starting point. S-Corp election can offer tax advantages once revenue grows, but that's a decision for your CPA based on your specific numbers.

How do I set up QuickBooks for an HVAC business?

Start with QuickBooks Online Plus (you need the Projects feature for job costing). Replace the default chart of accounts with HVAC-specific categories: Income split by service type (install, repair, maintenance agreements), Cost of Goods Sold (equipment, refrigerant, parts, labor, subcontractors), and Overhead (separate from job costs — truck, tools, insurance, office). Enable Projects for per-job tracking. Configure invoicing with your standard terms. The default QuickBooks setup doesn't include any of this.

What licenses do I need to start an HVAC business?

HVAC licensing requirements vary by state and sometimes by municipality. Most states require an HVAC contractor license (often requiring a journeyman or master certification plus a set number of hours of experience), EPA Section 608 certification for handling refrigerants, and a general business license. Some states require separate licenses for mechanical, plumbing, or electrical work that overlaps with HVAC. Check your state contractor licensing board for specific requirements. Licensing is outside our scope — we handle the business foundation.

How do I track job costs for HVAC service calls vs. installations?

In QuickBooks, create a Project for each install job and track materials, labor, and equipment against it. For service calls, you can either create individual projects (for large repairs) or batch them by month/week with a service-type tag. The key is your chart of accounts: income and COGS categories need to distinguish install revenue from service revenue, and parts/equipment from labor. This lets you answer 'what's my margin on installs vs. service calls?' — the most important question in HVAC.

Should I set up maintenance agreements from day one?

Yes — maintenance agreements are the most predictable revenue stream in HVAC. Set up the invoicing structure for recurring billing before you sign your first agreement: standard terms, annual vs. semi-annual pricing, what's included, and how renewals work. In QuickBooks, track maintenance agreement revenue as a separate income category so you can see recurring vs. project revenue at a glance. The contractors who build recurring revenue early are the ones who survive slow seasons.

How much does it cost to start an HVAC business?

Beyond licensing and tools/equipment: LLC formation ($50–$500 depending on state), EIN (free), business insurance ($2,000–$5,000/year for GL + vehicle), business bank account (varies), QuickBooks ($80–$100/month for Plus), and a vehicle if you don't already have one. Total business infrastructure cost: $3,000–$8,000 in year one, not including tools, equipment, or inventory. The Foundation Install handles the entity, banking, and bookkeeping setup — the infrastructure you need before you take your first job.

Do I need separate insurance for my HVAC business?

Yes. At minimum: General Liability insurance (covers property damage and bodily injury on job sites), Commercial Auto (if using a vehicle for business), and Workers' Comp (required in most states once you have employees). Many HVAC contractors also carry Professional Liability / Errors & Omissions and an inland marine policy for tools and equipment. Your insurance agent should specialize in contractor coverage — generic small business policies often have exclusions that leave HVAC-specific risks uncovered.

What's the biggest mistake HVAC companies make when starting out?

Pricing without knowing their numbers. They quote jobs based on what competitors charge or what 'feels right' instead of calculating actual costs: equipment, parts, labor (including drive time), vehicle costs, insurance allocation, and overhead. Without a proper bookkeeping setup that tracks job costs, they have no idea which jobs are profitable and which are losing money. We see HVAC companies doing $500K in revenue with less take-home than they made as an employee — because they never set up the financial visibility to know their true margins.

How long does it take to set up an HVAC business properly?

DIY, expect 6–10 weeks: state LLC filing (1–4 weeks), bank account setup (a few days), QuickBooks configuration (hours if you know HVAC accounting, weeks if you're learning), insurance quotes and binding (1–2 weeks). Our Foundation Install compresses the business infrastructure — entity through operating cadence — into 21 days. Licensing is separate and varies by state.