Should a new home inspector work for a company or go solo?

The Bureau of Labor Statistics counts home inspectors inside a larger group, construction and building inspectors, with about 153,900 jobs in 2025. Its employment projections table lists about 5,100 of them as self-employed, or 3.3%.

That share describes the whole group, and most of the group works for local governments and engineering firms. BLS publishes no separate count of home inspectors who work for a company and those who own one. So no federal number says which path most new home inspectors take.

BLS does say that business management courses help those who plan to run their own inspection business. Its wage figures also leave the self-employed out, so the $74,690 median for May 2025 describes paychecks, not owners. For more, see the home inspector salary guide.

A company can hire an inspector as an employee, paid on a W-2, or as an independent contractor, paid on a 1099. The title on the offer does not settle which one it is. The IRS looks at the facts in three groups:

• Behavioral control, meaning whether the company controls, or has the right to control, what the worker does and how.
• Financial control, meaning whether the payer controls the business side of the work.
• The relationship itself, such as a written contract, employee-type benefits, and whether the work is expected to continue.

Taxes split differently too. For an employee, the company withholds income tax and pays its own half of Social Security and Medicare. The IRS sets those halves at 6.2% and 1.45%, with the same amounts taken from the paycheck. A contractor has no withholding and pays both halves as self-employment tax, 15.3% of net earnings. When comparing a 1099 rate with a W-2 rate, count the employer's half that moves to the inspector.

When the status is unclear, either the company or the worker can file IRS Form SS-8. The IRS then reviews the facts and makes an official determination, which it says can take at least six months.

Federal minimum wage and overtime rules come from the Fair Labor Standards Act (FLSA). The Department of Labor says an employment relationship must exist for any of the act to apply. So the label affects pay rules as well as taxes. The department's test for that relationship has changed more than once. As of October 29, 2026, the record reads this way:

• A rule published in January 2024 took effect March 11, 2024, and is still the text in the federal regulations.
• On May 1, 2025, the Wage and Hour Division stopped applying that rule in its own investigations and went back to guidance from 2008. The 2024 rule still applies in private lawsuits.
• On February 27, 2026, the department proposed rescinding the 2024 rule and returning to its 2021 approach with a few changes. Comments closed April 28, 2026.
• No final rule had been published as of October 29, 2026.

State law can use a different test. California's ABC test, in effect since January 1, 2020, starts from the assumption that every worker is an employee. To treat someone as a contractor, a company has to show three things. The worker is free from its control, the work is outside its usual business, and the worker runs an independent business of the same kind.

Some home inspectors fall outside it. The state's labor agency FAQ lists certain home inspectors, as defined in the Business and Professions Code, under an older multifactor test called Borello. The ABC test does not apply to them. Other states set their own tests.

In the states checked for this post, the license or certification is issued to the person, not to the company. Washington's law bars anyone from acting as a home inspector without a license. It also makes presenting another inspector's license as one's own a civil infraction.

Arizona makes using another person's certification a class 2 misdemeanor. Each certified inspector there must also file their own proof of insurance, a bond, or net assets before doing a paid inspection. If that lapses, the certification is suspended automatically.

Texas ties a new inspector to someone else for a while. An apprentice inspector must be sponsored by a professional inspector and works under direct supervision. A real estate inspector also needs a sponsor and works under indirect supervision. Only the professional inspector tier inspects on its own.

Some company contracts include a noncompete, a clause that limits where or for whom an inspector can work after leaving. There is no federal ban. The Federal Trade Commission adopted one in 2024, and a federal court in Texas set it aside that same year.

The FTC voted to drop its appeals on September 5, 2025. It then removed the rule from the federal regulations, effective February 12, 2026. That leaves the question to state law. These four states void or limit noncompetes by statute:

Other states set their own rules. Nothing here is legal advice. Have an attorney licensed in the state read any contract with a noncompete or a nonsolicitation clause before signing it.

Pay terms vary by firm, and no public source publishes standard fee splits or hourly rates for home inspectors. Ask for these answers in writing:

• Is the job W-2 or 1099?
• Is pay hourly, a salary, a flat amount per inspection, or a share of each fee?
• Does the pay change for add-on services, such as a radon test?
• Who pays for insurance, and does the company's errors and omissions (E&O) policy name the inspector?
• Who pays for license renewal, continuing education, tools, software, and the vehicle?
• Who sets the schedule and the number of inspections a day?
• How much training and ride-along time comes first?
• Is there a noncompete or nonsolicitation clause, and how long and how far does it reach?

For what E&O covers and what a policy costs, see do home inspectors need E&O insurance.

A solo inspector carries every cost a company would. That starts with the license, its renewals, and any insurance the state requires. Arizona asks for $100,000 of E&O per occurrence and $200,000 in total, or a $25,000 bond or net assets. Texas asks for $100,000 of professional liability per occurrence or a $100,000 bond. New Jersey asks for E&O of at least $500,000 per occurrence. For the setup steps, from registering the business to the first listing, see how to start a home inspection business.

Then come self-employment tax at 15.3%, with no employer half, and the marketing that brings in jobs. Russ Motyko has done more than 3,000 inspections around Portland and Southwest Washington. In his view, agent referrals take 12 to 24 months of steady work to become a dependable share of the business. For more, see how home inspectors earn agent referrals.

He also advises a solo inspector to hold three to four months of operating expenses in reserve by October. For the reasoning, see how home inspectors handle the winter slowdown.

A company job does not close the door on going solo later, because the license stays with the inspector. Two things can slow the move: a noncompete the inspector signed, and in Texas, reaching the professional inspector tier.

For a third route, buying into a franchise, see is a home inspection franchise worth it.