Texas Dealer License Requirements

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Texas Dealers Licenses are regulated by the Texas Department of Transportation Motor Vehicle Division in Austin, Texas. Texas Dealers are required to obtain a general distinguishing number more commonly known as a "GDN".

There are Four Texas Dealer License Categories or GDN

Texas Motor Vehicle Dealer License: This license allows you to sell used motor vehicles.
Texas Motorcycle Dealer License: This license allows you to sell only motorcycles.
Texas Travel Trailer License: This license allows you to sell only non motorized travel trailers.
Texas Utility Trailer/Semi-Trailer License: This license allows you to sell new or used utility trailers or semi-trailers.
Franchised Texas Dealer License: In addition to a GDN a Texas Dealer must apply for a Franchise License if they are to sell any new motor vehicles other than new utility trailers or new semi trailers, which can be sold under a Texas Utility Trailer/Semi-Trailer license and does not require a Franchise License.

You must have a separate GDN for each type of vehicle you are selling. For example, if you are selling used motor vehicles and used motorcycles, you would need a Texas Motor Vehicle Dealer License and a Texas Motorcycle License. If you were selling only travel trailers, you would only be required to hold a Texas Travel Trailer license, and you would only be allowed to sell non motorized travel trailers. You find more information about your Texas dealer license plates by clicking here.

Download Texas Dealer License Application

You can download a Texas Dealer License GDN Application by clicking here:
Download Texas Dealer License Application. Your Texas dealer license application must be notarized. You can find other helpful Texas dealer license forms by clicking here.

Business Building

The Texas Department of Transportation requires that all dealers have a business building before they are granted a Texas dealers license. You must have an enclosed building that you conduct business in and you 100 square feet of space that does not include closets, restrooms, or hallways. Your business building must also have a minimum seven foot ceiling. Your business building must have electricity, heating, and lighting. The Texas Department of Transportation does not allow a Texas Dealers License at any residential facility. Your office must have a desk, two chairs, a file cabinet to hold dealer license records, a computer with internet access & printer so you can print the required paperwork, and a fax machine. The State of Texas also requires that you have a working telephone that is not a cellular phone or cordless phone reaching from another building. You must have a land line to obtain a Texas Dealers License. You must store all of your Texas dealer license records in your business building. You can find out exactly what dealer license records you are required to keep by clicking here.

Internet Access

All Texas Dealers are required by law to have internet access so they can issue temporary tags. All Texas Dealers are allowed to apply for a user name and password so they can issue temporary permits. Each temporary permit will have it's own number which allows the Texas Department of Motor Vehicles to know exactly who issued the temporary permit. You can obtain your e-tag access by contacting:

Texas Department of Motor Vehicles
Motor Vehicle Division
P. O. Box 2293
Austin, TX 78768-2293
Or email mvd-scancenter@txdmv.gov
Or call 1-888-368-4689 then select option 4

Dealer Business Sign

You must have a permanent business sign with your dealership name displayed prominently. Your dealership name must be at least 6 inches high or larger. If your dealership name is smaller than 6 inches the Texas Department of Transportation will reject your dealer license application. You permanent business sign must be attached to the building or mounted on a pole in the display area and must be viewable to the nearest roadway.

Display Lot

You must have a display lot with room for 5 or more motor vehicles of the type you are selling. If your business building is shared with another Texas dealer, you must keep each dealers inventory separate and each dealer will need at least 5 display spaces. A Texas dealer can have a storage lot at a separate location for vehicles but Texas law strictly prohibits any sales activity to take place on the storage lot. All retail sales activity must take place on the license lot. The display lot must be adequately lighted if the dealer is open after sunset. If you obtain prior approval from a Motor Vehicle Dealer division director you may possibly be allowed to have you display lot inside a building.

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Obtain Dealer Surety Bond

Before the Texas Motor Vehicle Division will grant your Texas dealers license you must obtain a 2 year dealer surety bond in the amount of $25,000. A separate dealer surety bond is required for each GDN category. You can obtain a 2 year dealer surety bond from most Texas insurance agents or Texas bonding companies.  If you have a great credit score your dealer surety bond should cost about $400 per two years. Your bond must be in effect for at least two years and may not expire during your licensing period. Your dealer surety bond must exactly match the information Make sure your bond provider gives you the power of attorney with the surety bond.

Photograph of Business Operations

You must include photographs of your dealership. You need to include a photograph of the exterior of the building, the office to include the file cabinet, 2 chairs, desk, & phone, the business sign, the posted hours of operation.

Provide Property Lease or Ownership Proof

You must include a copy of the lease that cannot expire during the licensure term or proof of ownership of the property if it is not leased.

Maintain Business Hours

After you obtain your TX dealers license you must maintain a minimum amount of business hours. The State of Texas requires you to be open at least 4 days a week at least 4 consecutive hours a day. Your hours of operation can be anytime between 8:00AM and 8:00PM. You must display your hours of operation prominently at the main office of the building. You, the owner, or an employee must staff the dealership during the minimum hours of operation. Regardless of your hours of operation the State of Texas requires your phone to be answered every weekday between the hours of 8:00AM and 5:00PM. Because of Texas Blue Law you may not operate your dealership on any consecutive Saturday and Sunday.

Display Texas Dealer License Prominently

When you receive your dealers license you must display it prominently. Don't keep it stored in a drawer make sure to frame it and display it on a wall for all of your customers to see.

Include Proof of Identity

You must show proof of identity to the State of Texas before you are granted a license. At least one owner, the managing partner of the dealership, or the president of the dealership must include proof of identity in the dealer application packet. Acceptable forms of proof of identity are a non-expired drivers license, a passport, a United States Armed Forces Identity Card.

Include Assumed Name Certificate

If you are filing as a corporation, limited liability  corporation, limited partnership, or limited liability partnership, you will need to include your articles of incorporation from the Secretary of State's Office. If you are filing as a sole proprietor or general partnership you will need to include the documentation from the County Clerk's office in the county in which your Texas dealership is located. You can download your Texas Assumed Name Certificate by clicking here.

Pay Dealer License Fees

Each GDN is $700.00 and the fee is non refundable. The fee for each Texas dealer license plate is $90.00. Be sure to call 888-368-4689 before mailing your dealer license application to ensure you are including the correct amount. Incorrect fees will delay your dealer license approval process.

Obtain Federal Tax ID Number

If you are forming a corporation you must obtain a Federal Tax ID number. You can apply for your Federal Tax ID number at www.taxformw9.com. If you are filing as a sole proprietor you can use your Social Security number. 

Mail Texas Dealer license Application Packet

If you have any questions before mailing your Texas dealer license application packet, please call 888-368-4689 or e-mail dealerlicense@txdmv.gov

Be sure to include the following documentation with your Texas Dealer License application packet:

Notarized and completed Texas dealer license application
Owner and management information Form LF601
Proof of identity
Assumed name certificate
Separate 2 year dealer surety bond for each GDN category
Power of Attorney that comes with dealer surety bond
Certificate of incorporation, organization or partnership
Business photographs
Proof of property lease or ownership
Federal tax ID number or social security number
Proper dealer license fees

If you are paying with check or money order your dealer license application packet must be mailed to the following address:

Texas Motor Vehicle Division
PO Box 13044
Austin, Texas 78711-3044

If you are paying your dealer license fees with a credit card you must mail your application to the following address:

Texas Motor Vehicle Division
PO BOX 2293
Austin, Texas 78768-2293

Click here for Texas Dealer Insurance.

Franchised Texas Motor Vehicle Dealer Application

Good Luck In Obtaining Your Texas Dealer License!

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