New York Used Motor Vehicle Dealer License Requirements – 2025 Overview

1. Who regulates New York dealers?

New York dealers are licensed by the New York State Department of Motor Vehicles (NY DMV).

• Regulator: New York State Department of Motor Vehicles
• Dealership opening guide: NY DMV – Open a Dealership
• Dealers & transporters hub: NY DMV – Dealers and Transporters

2. Dealer classes and focus on used retail dealers

NY DMV recognizes several dealer types. For used‑car operations, the most common categories are:

• Retail Motor Vehicle Dealer (Other than New) – sells used vehicles to the public and may also wholesale.
• Wholesale dealer – sells only to other licensed dealers and certain exempt purchasers.

Be sure to choose the dealer class that matches your business model when you complete your application forms.

3. Bond and insurance requirements

3.1 New York dealer surety bond

New York requires an auto dealer surety bond, with the amount based on your expected annual sales volume:

• Dealers selling 50 or fewer vehicles per year – typically a $20,000 bond.
• Dealers selling more than 50 vehicles per year – typically a $100,000 bond.

Bond thresholds and amounts can change, so always confirm current requirements with NY DMV or on the official “Open a Dealership” guidance.

3.2 Insurance

• Carry appropriate garage liability or commercial liability insurance that covers your dealer operations and vehicles.
• NY DMV may require proof of coverage as part of the application or registration process.

4. Business location, office, and display area

New York expects dealers to operate from a permanent business location that meets state rules and local zoning requirements. While exact details depend on zoning and your local municipality, you should be prepared to show:

• A permanent business location with a physical address.
• A business office where customers can meet with you and records are stored.
• A display area suitable for showing the vehicles you sell.
• A business sign or other visible identification consistent with local rules.

Some localities, especially New York City, may impose additional consumer‑protection and signage requirements.

5. Business entity, tax registration, and records

• Form a legal entity (sole proprietor, partnership, LLC, corporation) and register it with the New York Department of State, if required.
• Obtain a Federal EIN from the IRS.
• Register for New York State tax accounts as needed (such as sales tax registration with the Department of Taxation and Finance).
• Set up a recordkeeping system to track all vehicle purchases, sales, title work, and disclosures.

6. Typical application steps with NY DMV

Always follow the latest NY DMV instructions. A typical process for a used motor vehicle dealer might include:

1. Determine the dealer class (e.g., Retail Other than New, Wholesale) that matches your business plan.
2. Secure a business location that meets zoning and NY DMV requirements.
3. Obtain your dealer surety bond and insurance coverage.
4. Form your business entity and register any assumed names.
5. Complete the NY DMV dealer application forms and gather required documents (photos, fingerprints or background checks if applicable, tax information, etc.).
6. Submit the application package with fees to NY DMV as directed.
7. Respond to any NY DMV requests for additional information or corrections.

7. Ongoing New York dealer compliance

After your dealer registration is issued, you must:

• Renew your dealer registration, bond, and insurance on time.
• Use NY DMV‑approved forms for bills of sale (such as MV‑50) and title transfers.
• Follow rules for inspection, temporary plates, advertising, and disclosure.
• Keep complete records and cooperate with NY DMV inspections and investigations.

8. Official New York resources

• NY DMV – Open a Dealership
• NY DMV – Dealers and Transporters