A restoration business dries out water damage, cleans up after fires and smoke, and removes mold. Much of the work is paid by insurance, which means careful documentation and estimates in the carrier's format. The rest is homeowner-paid and small losses under the deductible. Many start with water damage, which needs the least special training, and add mold and fire later.
- Answer every call, day or night. Emergencies go to whoever picks up.
- Some states license mold remediation separately; check before you advertise it.
- In pre-1978 homes, tearing out painted drywall and trim can bring in the EPA lead rule.
- Plumbers, property managers and insurance agents send most of the work.
1. Decide what you will offer
| Work | Who asks | Notes |
|---|---|---|
| Water extraction and drying | Homeowners, property managers | The core of most shops |
| Mold remediation | Homeowners, realtors | Some states license it |
| Fire and smoke cleanup | Homeowners, insurers | More equipment and training |
| Rebuild after the dry-out | Homeowners | Contractor licensing applies |
| Storm response | Homeowners, businesses | Surge weeks, then quiet |
Decide whether you rebuild or hand off to a contractor. Rebuilding keeps the whole job but needs a contractor license in many states.
2. Check the license and permits
Some states license mold assessment and remediation on their own. Rebuild work after a dry-out usually falls under contractor licensing. Ask your state which apply before you advertise each service. Our general contractor licensing guide covers the rebuild side.
3. Mold and lead
The EPA's mold remediation guide for schools and commercial buildings lays out how to investigate, remediate and protect occupants and remediators, and notes that molds gradually destroy the things they grow on. The EPA's lead rule applies to firms that disturb painted surfaces in houses and child-occupied facilities built before 1978, which includes tear-out after water damage in older homes.
4. Register the business and set up taxes
The SBA lists the launch steps in this order: pick a location, choose a structure, choose a name, register, get federal and state tax ID numbers, apply for licenses and permits, open a business bank account, and get insurance. For a restoration business working out of a truck, the location is usually your home address and the area you will serve.
- Structure. A sole proprietorship is the simplest. An LLC keeps the business separate on paper. Ask an accountant which fits your state and your plans.
- Tax ID. The IRS gives out an employer identification number (EIN) online, and says you never have to pay a fee for one. Websites that charge for an EIN are not the IRS.
- Self-employment tax. The IRS lists the self-employment tax rate as 15.3%: 12.4% for Social Security and 2.9% for Medicare. Income tax comes on top, so set money aside from every job.
- Bank account. Open it before the first payment lands, so every dollar in and out is easy to find at tax time.
5. Pick a name customers can say and find
Your name goes on the truck, the invoices, the Google profile and the yard signs, so pick it once. The free restoration name generator gives 36 ideas for your town and style, each with a domain idea, and lists the checks to run before you commit: your state's business name search, a federal trademark search and the domain itself.
6. Get insured before the first job
The SBA describes general liability insurance as cover for financial loss from bodily injury, property damage, medical expenses and defending lawsuits. It says businesses with employees are required to carry workers' compensation, unemployment and disability insurance, and some states ask for more.
Restoration claims include mold that comes back, damage during drying and contents claims. Ask your agent about general liability, contractors' pollution liability for mold, commercial auto, and workers' compensation once you hire.
7. Gear up and add up your startup costs
No total here on purpose. What you spend depends on what you already own, new or used, and how much work you plan to take on. Price your own list with a local supplier, then put the numbers in the startup cost table of the free business plan generator, which adds them up for you.
- Truck-mounted or portable extraction
- Air movers and dehumidifiers
- Moisture meters and a thermal camera
- Air scrubbers, containment and protective gear
- A van or trailer set up to carry it all
Drying equipment is the main startup cost, and the number of units sets how many jobs you can run at once. Many start small and add units as jobs come in.
8. Set your prices
For homeowner-paid work, price labor hours, equipment days per unit, monitoring visits and disposal. Our guide to pricing restoration jobs has a worked water loss, and the free water damage restoration cost calculator and mold remediation cost calculator check the number.
9. Find your first customers
- Every call, answered. Koira answers on your number at any hour.
- Plumbers. They find the leaks.
- Property managers. Commercial outreach writes to them on Front Office.
- Insurance agents. Their customers ask who to call.
10. Get paid and keep the customer
On homeowner-paid jobs, collect on completion with pay at the door. The customer portal gives the homeowner one link for the visit, the estimate and the invoice. On claims, keep moisture readings and photos for every day of drying.
11. Grow past one truck
A second technician lets you run a night call and the day's monitoring. Read how restoration companies run on Koira.
Sources
- SBA: Launch your business (the launch steps), checked October 8, 2026
- SBA: Get business insurance, checked October 8, 2026
- IRS: Get an employer identification number, checked October 8, 2026
- IRS: Self-employment tax (Social Security and Medicare taxes), checked October 8, 2026
- EPA: Mold remediation in schools and commercial buildings, chapter 1, checked October 9, 2026
- EPA: Renovation, Repair and Painting Program, contractors, checked October 8, 2026
Last checked October 8, 2026. This page is general information, not legal or tax advice. Rules change and differ by state and city, so confirm with the agency named before you act.