Maryland Motor Vehicle Dealer License Requirements – 2025 Overview
Anyone who sells motor vehicles to the public as a business in Maryland must be licensed through the Maryland Motor Vehicle Administration (MVA) Business Licensing and Compliance division. This summary focuses on used-vehicle dealers, with notes that also apply to new, wholesale, and other license types.
Important: This is an unofficial overview, not legal advice. Requirements, bond amounts, and forms change. Always confirm details using the official Maryland MVA dealer licensing packet and web pages before applying.
1. Who regulates dealers in Maryland?
Maryland dealer licenses are issued by the MVA’s Business Licensing and Compliance unit. Separate pages cover used dealers, wholesale-only dealers, manufacturers, and distributors.
- Regulator: Maryland Motor Vehicle Administration – Business Licensing and Compliance
- Dealer Licensing Packet: MVA Dealer Licensing Packet (all dealer types)
- Used vehicle dealer license page: License to Sell Used Vehicles – Maryland MVA
- Wholesale dealer license page: License for Wholesale Vehicle Dealer – Maryland MVA
- Bonding requirements: Bonding Requirements and Fines for Vehicle–Related Businesses
2. Maryland dealer license types
The MVA issues several business license types for vehicle–related operations. For most retail automotive operations, the key categories include:
- Used Vehicle Dealer – sells used vehicles at retail to the public.
- New Vehicle Dealer – sells new vehicles under a manufacturer franchise agreement.
- Wholesale Vehicle Dealer – sells vehicles to other licensed dealers (no retail public sales).
- Manufacturer / Distributor – sells or distributes vehicles into Maryland.
The Dealer Licensing Packet includes a Summary of Dealer Types explaining which license is appropriate for each business model.
3. Business location, zoning, and facility requirements
Before you apply, you must secure an established place of business that meets MVA and local zoning standards.
- Ownership or lease: Proof of ownership or a lease of at least one year is required for the property where the office will be located. If the property is subleased, a copy of the primary lease is also required.
- Office: A permanent office where business records are kept and customers can be served. Home–based businesses are permitted only if the home is the licensee’s domicile and local zoning allows it.
- Display area: Adequate space to display vehicles offered for sale, consistent with the license type.
- Zoning sign–off: A zoning official from the county or municipality must sign the MVA zoning form confirming the site can legally be used as a dealership.
- Inspection: The MVA will inspect the location as part of the licensing process. Incomplete applications or locations that do not meet the checklist will be rejected.
4. Entity, trader’s license, background checks, and bond
4.1 Business entity and tax registration
- Form your entity (sole proprietorship, partnership, LLC, or corporation) and register with the Maryland State Department of Assessments and Taxation (SDAT).
- Obtain your FEIN and register for Maryland sales and use tax if required.
4.2 Trader’s license and liability insurance
- Obtain a Trader’s License from the clerk of the circuit court in the county where your business is located. This is required for many retail dealers before the MVA will issue the business license.
- Secure garage or commercial liability insurance meeting Maryland’s minimum standards and naming the dealership appropriately.
4.3 Criminal background checks
Owners, partners, and key officers must usually complete a criminal background check. The MVA instructions specify the vendor, fingerprint process, and how recent the background report must be.
4.4 Surety bond requirements
Maryland requires a surety bond for vehicle dealers and related businesses. The MVA publishes a chart that lists the required bond amount by license type along with potential fine amounts for violations.
- The bond must be issued on the official MVA bond form in the exact dealership name.
- The bond must remain in force as long as the license is active; cancellation or reduction can lead to license suspension.
5. Maryland dealer license application process
The Dealer Licensing Packet includes all required forms and a detailed checklist. At a high level, the process typically looks like this for a used vehicle dealer:
- Determine your license type (used, wholesale, new, manufacturer, etc.).
- Secure a properly zoned business location and obtain zoning sign–off.
- Form your entity, obtain your FEIN, and set up tax accounts.
- Obtain a Trader’s License from the circuit court and garage liability insurance.
- Complete criminal background checks for each owner / officer.
- Purchase the required surety bond in the correct amount and business name.
- Complete the MVA Dealer Licensing Packet forms for your license type, including ownership disclosure, financial information, and location details.
- Submit the full application package with all supporting documents and fees to Business Licensing and Compliance.
- Prepare for and pass the MVA site inspection.
6. After approval: ongoing Maryland dealer compliance
- Renew your dealer license, bond, Trader’s License, and insurance on schedule.
- Maintain your place of business, including office, display area, and zoning compliance.
- Follow MVA rules for titling, registration, temporary tags, and late–title fines.
- Keep complete records of all deals for the retention period specified by Maryland law.