Minnesota Motor Vehicle Dealer License Requirements – 2025 Overview
Minnesota law requires anyone who sells more than a small number of vehicles per year for profit to obtain a Motor Vehicle Dealer License from Driver and Vehicle Services (DVS). This overview focuses on typical retail and wholesale motor vehicle dealers.
Important: This is an unofficial summary. Always confirm current statutes, rules, and forms through the Minnesota Department of Public Safety – Driver and Vehicle Services.
1. Who regulates dealers in Minnesota?
Dealer licensing is handled by the Minnesota Department of Public Safety – Driver and Vehicle Services (DVS).
- Regulator: DPS – Driver and Vehicle Services (DVS)
- Motor Vehicle Dealer License overview: Motor Vehicle Dealer License – MN.gov
- Dealer forms (wholesaler example): Motor Vehicle Wholesaler Dealer Licensing – Forms
- Surety bond form: Motor Vehicle Dealer License Surety Bond (PS2446)
2. Minnesota dealer license types (high level)
Minnesota recognizes several categories, including:
- New motor vehicle dealer
- Used motor vehicle dealer
- Wholesale dealer
- Additional categories for specialty dealers (motorcycles, trailers, etc.).
Each category uses the same basic licensing forms (application, bond, zoning verification) but may require different supporting documents, such as franchise agreements for new dealers.
3. Commercial location, zoning, and building requirements
DVS requires dealers to operate from a bona fide commercial location suitable for vehicle sales.
- A commercial building on a permanent foundation, adapted for commercial use and meeting local government requirements.
- Connection to local sewer and water facilities or compliance with local sanitation codes.
- A zoning verification form (PS2421) completed by the local zoning official confirming commercial use is allowed.
- If leased, a Verification of Property Lease (PS2407) showing a minimum lease term (commonly at least one year) or proof of property ownership.
- A Commercial Location Checklist (PS2410) verifying that all site standards are met before filing an application.
Applications should only be submitted once the location meets all checklist requirements; otherwise, processing will be delayed or denied.
4. Entity, taxes, surety bond, and insurance
4.1 Business entity and tax registration
- Form your business entity and register with the Minnesota Secretary of State, if applicable.
- Obtain a Federal Employer Identification Number (FEIN) and register with the Minnesota Department of Revenue.
4.2 $50,000 surety bond
Minnesota requires most motor vehicle dealers to provide a $50,000 surety bond as part of the license application. The official bond is filed on DVS form PS2446.
- The bond ensures the dealer will comply with Minnesota Statutes, pay required taxes and fees, and protect the state and consumers against financial loss if laws are violated.
- Small specialty categories (such as certain trailer-only operations) may have lower bond amounts; confirm current bond levels with DVS.
4.3 Insurance
- Maintain adequate garage or commercial liability insurance covering your operations and dealer plates.
5. Minnesota dealer license application process
The exact packet depends on whether you are applying as a new, used, or wholesale dealer, but the general steps are similar:
- Determine the correct license type for your business model (new, used, wholesale, etc.).
- Secure a commercial location and verify zoning compliance using the required forms.
- Form your entity, obtain tax registrations, and arrange your $50,000 dealer bond and insurance.
- Complete the motor vehicle dealer license application and all supporting forms (bond, zoning verification, lease verification, commercial location checklist, franchise agreement if applicable).
- Submit the completed packet and fees to DVS at the address listed on the forms.
- Respond to any DVS requests and be prepared for site review or further documentation as needed.
6. After approval: ongoing Minnesota dealer compliance
- Renew your dealer license, bond, and insurance before they expire.
- Maintain your commercial location and keep it compliant with local zoning and DVS standards.
- Keep complete sales, title, and tax records for the retention period required by Minnesota law.
- Follow DVS rules for temporary permits, title transfers, and fee collection.