What You Need to Do to Become a Licensed Car Dealer in Florida
To become a licensed car dealer in Florida, you must register with the Florida Department of Highway Safety and Motor Vehicles (DHSMV), pass a background check, obtain a surety bond, and meet specific location and facility requirements. The process takes roughly four to eight weeks from start to approval, though timing depends on how quickly you gather documents and how the DHSMV processes your submission.
Florida distinguishes between a dealer license (which lets you buy and sell vehicles as a business) and a salesperson license (which lets you work for a dealer). This guide covers the dealer license path. The state also has separate rules for used-car dealers, new-car dealers, and mobile home dealers — most people starting out pursue a used-car dealer license because the barriers are lower.
Key Takeaways
- You must obtain a surety bond from an insurance company before the DHSMV will issue your license; the bond amount is set by the state and covers customer complaints.
- Your dealership location must be a permanent, fixed address with a sign visible from the street; you cannot operate from a residential property or a temporary space.
- You will need a federal Employer Identification Number (EIN) from the IRS, even if you are a sole proprietor, because the DHSMV requires it on your process.
- Florida requires a background check that includes fingerprinting; felony convictions related to fraud, theft, or dishonesty can disqualify you.
- The DHSMV charges a license fee and renewal is required every two years; you must also maintain records of all vehicle sales and keep them available for inspection.
The Surety Bond Requirement and How Much It Costs
A surety bond is a three-party agreement: you (the principal), an insurance company (the surety), and the state (the obligee). The bond protects customers if you fail to deliver a title, misrepresent a vehicle, or fail to honor a warranty. If a customer files a valid claim, the surety pays up to the bond limit, and you repay the surety.
Florida requires a minimum bond amount of $25,000 for a used-car dealer. The cost of the bond itself — called the premium — is typically 1 to 3 percent of the bond amount per year, so you would pay roughly $250 to $750 annually. The exact premium depends on your credit score, business history, and the surety company's underwriting. You obtain the bond from a licensed surety company, not from the DHSMV directly. Many insurance brokers and bonding companies in Florida offer dealer bonds; you can search online or ask your accountant for a referral.
You must have the bond in place before you submit your dealer process. The DHSMV will not issue a license without proof of an active bond. Once you receive your license, you must renew the bond every two years to keep your license active.
Location and Facility Requirements
Your dealership must be located at a permanent, fixed address that is not a residential property. The DHSMV requires that the address be a commercial space — typically a lot, garage, or storefront — where customers can visit during business hours. You cannot operate from your home, a temporary tent, or a shared space without a dedicated entrance and signage.
The facility must display a dealer sign that is visible from the street and clearly identifies your business as a motor vehicle dealer. The sign must include your dealership name and the word "dealer." The DHSMV does not dictate the exact size or design, but it must be legible and permanent (not a handwritten sign or a banner that can be easily removed).
You must also have adequate space to store vehicles, maintain records, and conduct business with customers. The DHSMV may inspect the location before or after issuing your license. If you lease the space, you will need written permission from the landlord to operate a dealership there, and you should provide a copy of the lease or a letter of consent with your process.
Getting Your Federal EIN and Business Registration
Before you explore for a dealer license, you need a Federal Employer Identification Number (EIN) from the Internal Revenue Service. An EIN is a nine-digit number that identifies your business for tax purposes. Even if you are a sole proprietor with no employees, the DHSMV requires an EIN on your dealer process.
You can obtain an EIN free of charge by explore online at the IRS website (irs.gov), by phone, by fax, or by mail. The online process is fastest and typically issues your EIN when ready. You will need your Social Security number, the legal name of your business, and your business address. Once you have the EIN, keep it in a safe place — you will need it for your dealer process, your surety bond process, and your tax filings.
You should also register your business with the Florida Department of State if you are forming a corporation, limited liability company (LLC), or partnership. If you are a sole proprietor operating under your own name, registration is optional but recommended. Registration creates a public record of your business and protects your business name. You can register online through the Florida Division of Corporations website.
The Background Check and Fingerprinting Process
The DHSMV conducts a background check on all dealer applicants. The check includes a review of your criminal history, driving record, and any prior disciplinary actions by the DHSMV or other state agencies. You will be required to submit to fingerprinting as part of the process.
Certain criminal convictions can disqualify you from holding a dealer license. These include felonies related to fraud, theft, forgery, embezzlement, or dishonesty. Misdemeanors related to vehicle sales or consumer protection violations can also be grounds for denial. The DHSMV has discretion to deny a license if it determines that you are not of good moral character or that you have violated motor vehicle laws.
You will be notified if the DHSMV needs additional information or if there are issues with your background check. If you are denied, you have the right to request a hearing before the DHSMV to contest the decision. You can reapply after addressing the issues that led to the denial.
Completing and Submitting Your Dealer process
The DHSMV process for a used-car dealer license is Form HSMV 83039. You can read it from the DHSMV website or request it by mail. The form asks for your personal information, business details, location address, EIN, surety bond information, and a description of your business operations.
You must submit the completed form along with supporting documents: a copy of your surety bond, proof of your business registration (if applicable), a copy of your lease or proof of ownership of the dealership location, a photo of the dealer sign, and proof of your EIN. Some applicants also include a letter from the landlord consenting to the dealership use, especially if the lease does not explicitly allow it.
Submit your process by mail to the DHSMV address listed on the form, or check the DHSMV website to see if online submission is available. Include a check or money order for the license fee. The fee varies depending on the type of dealer license, but for a used-car dealer it is typically in the range of $150 to $300. Processing usually takes four to eight weeks. You can contact the DHSMV to check the status of your process.
Record-Keeping and Ongoing Compliance Obligations
Once you receive your dealer license, you are required to maintain detailed records of every vehicle you buy and sell. These records must include the vehicle identification number (VIN), the date of purchase and sale, the purchase price and sale price, the name and address of the buyer and seller, and a copy of the title transfer. You must keep these records for at least three years and make them available for inspection by the DHSMV at any time.
You must also comply with Florida's consumer protection laws, which prohibit deceptive practices, require you to disclose known defects, and set rules for warranties and refunds. The DHSMV can inspect your dealership, your records, and your advertising to may support compliance. Violations can result in fines, license suspension, or license revocation.
Your dealer license must be renewed every two years. Renewal requires proof that your surety bond is still active, payment of the renewal fee, and confirmation that you are still operating at the same location. If you move your dealership, you must notify the DHSMV and update your license. If you close your dealership, you must surrender your license to the DHSMV.
Frequently Asked Questions
Do I need a salesperson license if I have a dealer license?
No. A dealer license allows you to buy and sell vehicles on behalf of your dealership. A salesperson license is only required if you work for another dealer and sell vehicles on their behalf. If you are the owner or manager of your own dealership, you do not need a separate salesperson license.
Can I operate a dealership from my home or a residential area?
No. Florida law requires a permanent, fixed commercial address with a visible dealer sign. Residential properties, even if you have a separate garage or lot, do not meet this requirement. The DHSMV will deny your process if your proposed location is residential.
What happens if I sell a vehicle without a dealer license?
Selling vehicles as a business without a license is illegal in Florida and can result in criminal charges, fines, and civil penalties. The DHSMV actively investigates unlicensed dealers, especially those selling multiple vehicles per year. If you are caught, you may face prosecution and be barred from obtaining a license in the future.
How long does it take to get a dealer license after I submit my process?
Processing typically takes four to eight weeks, depending on the completeness of your process and the DHSMV's workload. If the DHSMV requests additional information, the timeline extends. You can contact the DHSMV to check your process status, but there is no way to expedite the process.
Can I transfer my dealer license to a different location?
No. Your license is tied to a specific address. If you move your dealership, you must notify the DHSMV and update your license information. In some cases, you may need to reapply or pay a transfer fee. Contact the DHSMV before you move to understand the exact process.