Indiana Dealer License: A Complete Guide

In Indiana, auto dealers that sell more than 12 motor vehicles (or six watercraft) over the course of a year are required to get an auto dealer license. If you want to get your dealer license, you must first complete the requirements set by the Indiana Secretary of State Auto Dealer Services Division.

In this guide, we will outline all the steps you need to take to get your Indiana dealer license. 

Here’s what we’ll cover:

Step 1: Determine license type

The first step to getting your Indiana dealer license is to figure out what type of license you need. The various license classifications tailor to different types of businesses. Here are the dealer license classifications in Indiana:

  • Dealer license: Lets dealers sell new and used motor vehicles or used vehicles only depending on the specification.
  • Manufacturer license: Lets the licensee manufacture new motor vehicles and sell them to the public or licensed dealers.
  • Distributor license: Lets the licensee sell motor vehicles to other dealers.
  • Auto auction dealer: Lets the licensee sell motor vehicles at auctions.
  • Watercraft dealer license: Lets the dealer sell watercraft or trailers designed to pull watercraft.
  • Automotive salvage recycler license: Lets the licensee dismantle vehicles and sell used motor vehicles.

Step 2: Get your business location 

Before you can receive your dealer license, you must establish your permanent place of business. This business location must meet the following requirements:

  • Must have an office space with a minimum of 100 square feet
  • Must be open 30 hours per week
  • Must have display area that can show at least 10 vehicles
  • Must have a parking area for customers
  • Must have an exterior sign that displays the business name
  • Must have a business telephone line

Step 3: Register your business

Indiana car dealerships must register their business with the Indiana Department of Revenue. You will need to get a Federal Employee Identification Number from the IRS before you can complete the registration.

When you are ready to register your business, you can do it online through the Department of Revenue’s website

Step 4: Get insurance

Indiana auto dealers must obtain general liability insurance for their permanent place of business. Below are the minimum coverage amounts:

  • $100,000 coverage per person
  • $50,000 coverage for property damage
  • $300,000 coverage per accident

Step 5: Get a surety bond

Auto dealers are required to post an Indiana surety bond before receiving their license. The bond provides financial protection to third parties that may be damaged during the dealer’s course of business.

The required bond amount for Indiana motor vehicle dealer bonds is $25,000. Dealers only need to pay a small percentage of this amount (typically 1% to 3%) as the premium. Before the surety company issues your bond, they will give you a quote for your premium based on your industry experience, credit score, and other factors.

Step 6: Submit license application

Once you have met all the requirements, you are ready to complete your application. You can do so online through the dealer portal on the Secretary of State’s website. 

When completing the application, you will need to provide the following supporting documents:

  • Business documents
  • Background check
  • Pictures of business location
  • Proof of insurance
  • Retail merchant certificate

You will also need to pay a $30 licensing fee and $125 for your first two dealer plates. Each additional dealer plate requires a $30 fee.

Indiana dealer license frequently asked questions

How much is a dealer license in Indiana?

Indiana car dealers must pay a $30 licensing fee and $125 for dealer plates. You also need to get a surety bond, which can cost as low as $250.

How do you renew an Indiana dealer license?

Indiana dealer licenses expire annually. The expiration date is based on the first letter of the licensee’s business name. You can find the list of expiration dates on the Indiana Secretary of State website.

You can complete your renewal application online similar to the original application. Keep in mind that your surety bond expires at the same time as your license and will need to be renewed as well.

How many cars can you sell in Indiana without a dealer license?

Individuals in Indiana can sell up to 11 motor vehicles and five watercraft per year before they must get a dealer license.

How EZ Surety Bonds can help with an Indiana dealer license

These are the steps you must take to get your Indiana dealer license. When you are ready to get the process started, EZ Surety Bonds can help you secure your auto dealer bond quickly and conveniently. 
We provide competitive premiums and quick turnarounds for all dealers. Apply online today or get in touch to learn more.