Indiana Auto Dealer License and Dealer Bond Guide

The Indiana auto dealer bond and who it protects

In Indiana, dealers are licensed by the Secretary of State, Auto Dealer Services Division, not the BMV. An application for a license must come with evidence of a $25,000 bond. The agency page lists one flat $25,000 figure, with no tiers by dealer type or sales volume.

The bond is written on State Form 53966, and the Division will only accept the (R7/03-24) version. The same form is used for many license classes, including dealer, auction, manufacturer, distributor and transfer dealer, and it has a blank bond-amount box, so confirm the figure with the Division if you are applying for a class other than a new or used dealer.

The bond runs in favor of the State of Indiana – Secretary of State. It backs the dealer's compliance with the laws governing the license, and it secures payment of fines, penalties, costs, and fees assessed by the Secretary of State, plus damages to a person harmed by a violation of IC 9-32.

Who needs a license and what to gather

You need a used motor vehicle dealer license if you sell, offer to sell, or advertise for sale at least 12 used motor vehicles in a 12-month period, and the same threshold applies to new dealers. That count includes semitrailers, trailers, off-road vehicles, snowmobiles, mini-trucks, and recreational vehicles. The Secretary of State lists separate classes such as Dealer – New or Used, Distributor, Manufacturer, Transfer Dealer, and Auto Auction.

The dealer application calls for these items:

• Business entity documentation through INBiz.
• Certificate of insurance.
• The Indiana Vehicle Merchandising Certificate/Bond (State Form 53966).
• Retail Merchant Certificate from the Indiana Department of Revenue.
• Zoning Affidavit (State Form 55936), photos of the location, photo identification, a background check, and the license fee.

First-time used car dealers who have not been licensed before must also complete a dealer training course presented by the Indiana Independent Automobile Dealers Association. Background check results more than 60 days old when you submit the application will not be accepted, and a zoning affidavit signed by a zoning official more than 90 days before submission will not be accepted either.

You must carry liability insurance covering the established place of business, with limits of at least $100,000 for bodily injury to one person, $300,000 per accident, and $50,000 for property damage; a membership in a risk retention group regulated by the Indiana Department of Insurance may be used in place of that insurance. On your insurance certificate, the holder must be the Indiana Secretary of State; a certificate that lists the BMV as the holder will not be accepted. The application is completed online.

Renewal and the staggered expiry schedule

Both dealer licenses and dealer license plates expire every year, and the date depends on the first letter of your business name.

Renewal is online only, and you can submit it up to 90 days before your expiration date. The Division accepts continuation certificates for existing bonds, and you must sign the bond before you submit it; an unsigned bond is one of the most common errors dealers make. The agency pages do not state a fixed bond term; the form simply carries effective and expiration date boxes, and the bond runs between those dates. Make sure the expiration dates on your bond and insurance fall after your license expiration date. As of October 1, 2024, bond or insurance updates must be done online through the Dealer Portal, and the Division no longer accepts them by mail or email.

Frequently asked questions

Comparing nearby states? See the dealer bond pages for Ohio, Michigan, Illinois, and Kentucky.