A Texas Dealer License from the Texas Department of Motor Vehicles (TxDMV) provides access to wholesale Vehicle Auctions across the country, Texas Dealer Plates, and other benefits which are only available to licensed Dealers. Your license lets you legally buy, sell, and operate as a dealership.
This guide walks you through all the requirements, costs, and steps needed to obtain your license. Whether you’re an individual or a business owner, you’ll find everything you need to know to get started here.
Texas Dealer License Requirements
This checklist simplifies the steps required to obtain a Texas Dealer License as quickly as possible. By following these steps, you’ll stay on track, avoid delays, and submit your application with confidence.
1. Name Your Texas Dealership
The first step in getting your Texas Dealer License is choosing a business name and structure. This determines who can be added to your Texas Dealer License and enjoy Dealer benefits like access to wholesale auctions, dealer plates, tax exemptions and more.
The TxDMV allows you to apply for your license three different ways. You’ll need to decide if you want to apply as a:
- LLC or Corporation: Perfect for individuals or groups seeking maximum flexibility, as you can add or remove members both during the application process and after receiving your dealer license.
- Sole Proprietorship: Suitable option for individuals not needing others on the license. However, this cannot be changed to an LLC or Corporation later on.
- Partnership: Designed for two or more owners, but comes with risks. If any partner exits the business for any reason, the Dealer License will be revoked.
2. Complete a Texas Dealer Pre-Licensing Course
Complete an online pre-licensing Dealer training course to receive your TxDMV Certificate of Completion, required when you submit your Dealer License application. This step will also assist with any questions about the licensing process.
This training is only required for Independent (GDN) Licenses (listed below in step 3).
3. Choose a Texas Dealer License Type
The Texas Department of Motor Vehicles (TxDMV) offers various Dealer License types for selling used, salvage, or new vehicles.
Independent (GDN) Licenses
Required to buy, sell, or exchange specific used vehicles.
- Independent Motor Vehicle Dealer
- Independent Motorcycle Dealer
- Travel Trailer Dealer
- Trailer/Semitrailer Dealer
- Independent Mobility Motor Vehicle Dealer
- Wholesale Dealer
- Wholesale Auction Dealer
Salvage Vehicle Dealer License
Required to buy, sell, or rebuild salvage or non-repairable vehicles.
- Salvage Vehicle Dealer
- Salvage Vehicle Rebuilder
- Salvage Vehicle Broker
Franchised Motor Vehicle Dealer License
Required to sell new vehicles under a manufacturer or distributor agreement.
- Franchised Motor Vehicle Dealer
- Franchised Motorcycle Dealer
- Franchised Travel Trailer Dealer
- Franchised Motorhome Dealer
4. Secure a Business Location
At this stage, you’ll need your business location and address which will be used throughout your Texas Dealer License Application process. Texas dealer location requirements include a:
- Physical office with at least 100 sq. ft.
- Business sign with six-inch letters (visible from 100ft)
- Posted business hours at the entrance
- Retail Dealers must have a display (5 vehicles)
- Copy of lease agreement or proof of property ownership
5. Obtain Zoning Approval
Ensure your dealer address meets local zoning requirements for vehicle sales. This can be confirmed by contacting your local city or county planning and zoning department to check whether a Certificate of Occupancy or Certificate of Compliance is available for your location.
6. Get a Texas Auto Dealer Surety Bond
Texas requires a Surety Bond (commonly known as a Dealer Bond), valued at $50,000. You only pay a small fee each year, starting as low as $225.
A bond is not required for independent travel trailer and trailer/semi-trailer GDN licenses.
7. Apply for your Texas Dealer License
Create an account on the Texas DMV eLICENSING portal to complete and submit your Texas Dealer License application. You will pay your license fees online through the eLICENSING system to finalize your application.
8. Submit Fingerprints and Background Check
After submitting your Dealer License application to TxDMV for processing, the Motor Vehicle Division (MVD) will email you if you or someone on your Dealer License requires fingerprinting. Their email to you will include instructions, the TxDMV Service Code, and details on who on your application needs fingerprinting.
Texas Dealer License Costs
Fees are paid directly to the Texas Department of Motor Vehicles (TxDMV) and are required to obtain or renew your Dealer License. Texas requires separate fees for each Dealer License type, meaning you’ll need to pay for each license you hold.
Independent (GDN) Licenses
$700 for the first-year application and $700 annually to renew per license type.
- Independent Motor Vehicle Dealer
- Independent Motorcycle Dealer
- Travel Trailer Dealer
- Trailer/Semitrailer Dealer
- Independent Mobility Motor Vehicle Dealer
- Wholesale Dealer
- Wholesale Auction Dealer
Salvage Vehicle Dealer License
$190 for the first-year application and $170 annually to renew (valid for two years)
Franchised Motor Vehicle Dealer License
$350 for the first year and $350+ annually to renew, depending on sales volume.
Texas Dealer License Benefits
A Texas Dealer License lets you legally buy, sell, and operate as a dealership with access to dealer-only resources across the state and nationwide. Here’s what it offers:
- Access Dealer-only Auctions: Attend dealer-only auctions like Manheim, ADESA, and Copart across Texas and the U.S.
- No Limits on Vehicle Sales: Buy and sell an unlimited number of vehicles.
- Tax-Free Inventory: Purchase vehicles without paying Texas sales tax or registration fees.
- Texas Dealer License Plates: Legally drive your dealership inventory using dealer plates.
- Dealer Inventory Financing: Use floor plans to finance your inventory without upfront cash.
Support
Texas Dealer License Support
- Dealer Licensing: (512) 465-4029
- Licensing/Salvage: (888) 368-4689 or (512) 465-3000
- DealerLicense@TxDMV.gov
Dealer 101® Support
- (619) 333-0701
- contact@dealer101.com