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Important Notices!
*****  Administrative Law Division Move Effective October 1st, 2014  *****
The Taxpayer Fairness Act transfers Revenue's Administrative Law Division to the newly-created Alabama Tax Tribunal; their website is now http://taxtribunal.alabama.gov/.
 

Motor Vehicle

Motor Vehicle Division - Registration FAQs  

 

Dealer License FAQs

Click on a question below to view the answer.

Who is required to to obtain the dealer regulatory license?

What is the dealer regulatory license period?

How do I apply for a dealer license?

Is it acceptable to fax my transmittal sheet, insurance certificate or surety bond?

What are the surety bond requirements for obtaining a motor vehicle dealer’s license in Alabama?

What insurance is required to get a license? What proof of insurance must I submit with my application?

If I previously provided an insurance certificate must I submit a new one with this year’s application?

Do I need a Sales Tax Number?

How do I apply or register for a Sales Tax Number?

If I sell motor vehicles on the Internet, am I required to obtain a motor vehicle dealer’s license?

What do I need to do if I move from my licensed location?

Is there a charge for each location?

Am I required to remit any additional money when making a change to my regulatory license?

If I bring my application to Montgomery in person, what do I need to bring and where do I go?

What are the location and sign requirements?

When providing a picture of my sign and location, may I use digital photographs?

If I want to conduct a tent sale at a different location, what must I do to obtain the proper licenses?

 

Who is required to obtain the dealer regulatory license?

All new and used motor vehicle dealers, wholesale dealers, reconditioners and rebuilders. Effective August 1, 2014, the definition of motor vehicle will include motorcycles and trailers, except trailers not required to have a certificate of title. This means that for the first time, motorcycle and trailer dealers (excluding trailers not subject to titling) will be required to obtain the dealer regulatory license. Also, effective August 1, 2014, the reconditioner license will be combined with the rebuilder license and a separate reconditioner category will no longer exist. The dealer regulatory licenses are defined below (reference Section 40-12-390, Code of Alabama 1975).

New motor vehicle dealer - Any person, firm, or corporation which holds a bona fide contract or franchise in this state in effect with a manufacturer or distributor of new motor vehicles and is engaged in the business of selling, advertising, or negotiating the sale of new motor vehicles or new and used motor vehicles, and the duly licensed new motor vehicle dealers shall be the sole and only persons, firms, or corporations entitled, other than in connection with the rental or leasing of new motor vehicles by persons engaged in the business of motor vehicle rental and leasing, to sell and publicly or otherwise solicit and advertise for sale new motor vehicles. Effective August 1, 2014, this definition will also include motor vehicle rebuilders and motor vehicle wholesalers.


Used motor vehicle dealer - Any person, firm, or corporation engaged in the business of buying, selling, exchanging, advertising, or negotiating the sale of five or more motor vehicles at retail during a calendar year, whether or not the motor vehicles are owned by such person, firm, or corporation, or in offering or displaying motor vehicles for sale at retail to the public. The term "selling" or "sale" shall include lease-purchase transactions. The term "used motor vehicle dealer" does not include banks, credit unions, and licensees of the State Banking Department, and finance companies which acquire motor vehicles as an incident to their regular business and does not include motor vehicle rental and leasing companies. Effective August 1, 2014, this definition will also include motor vehicle rebuilders and motor vehicle wholesalers.


Motor vehicle wholesaler - Any person, firm, or corporation engaged in the business of buying, selling, or exchanging motor vehicles at wholesale to motor vehicle dealers and not to the public.


Motor vehicle rebuilder - Any person, firm, or corporation engaged in the business of making or causing to be made extensive repairs, replacements, or combination of different motor vehicles to the extent of extinguishing the identity of the original vehicle to the extent that the finished motor vehicle shall be assigned a new identification to be issued by the Department of Revenue under the provisions of Chapter 8 of Title 32. Effective August 1, 2014, this definition will also include any person, firm, or corporation engaged in the business of refurbishing, repairing, or replacing damaged parts of motor vehicles for the purpose of preparing the vehicle for resale under the same identification and identity as the vehicle bore before the refurbishing.


Motor vehicle reconditioner - Any person, firm, or corporation engaged in the business of refurbishing, repairing, or replacing damaged parts of motor vehicles for the purpose of preparing the vehicle for resale under the same identification and identity as the vehicle bore before the refurbishing. Effective August 1, 2014, the reconditioner license will be combined with the rebuilder license and a separate reconditioner category will no longer exist.

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What is the dealer regulatory license period?

The dealer license period begins on October 1st and ends on September 30th of the following calendar year. All licenses expire on September 30th regardless of whether the license was issued on October 1st of the prior year or at some date later in the license year. Licensees who want to continue their license must renew it by no later than October 31st of the subsequent license year to maintain a valid license.

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How do I apply for a dealer license?

All new dealer regulatory license applications and dealer regulatory license renewal applications shall be filed electronically through the following dealer license website: https://dealerlicense.mvtrip.alabama.gov/. Upon completion of the application, the transmittal sheet must be printed and mailed to the Department along with supporting documents specified on the transmittal sheet.

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Is it acceptable to fax my transmittal sheet, insurance certificate or surety bond?

A copy of the completed insurance certificate is acceptable as long as it is legible and unaltered. All other documents must be originals.

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What are the surety bond requirements for obtaining a motor vehicle dealer’s license in Alabama?

Franchised new car dealers must post a $25,000 bond while all other licensees must post a $10,000 bond. If the bond is cancelled for any reason, the license will be revoked. If there is a change in the bonding company, a new bond must be delivered to the Motor Vehicle Division before the old bond is cancelled. Otherwise, the license will be revoked when the coverage ceases under the old bond. Note: a new bond must be provided when changing from one legal entity to another. Effective August 1, 2014, all licensees will be required to submit to the Department a continuous bond in the amount of $25,000. All new and used dealers are required by law to become designated agents of the department. The dealer bond also satisfies the designated agent bonding requirement.

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What insurance is required to get a license? What proof of insurance must I submit with my application?

Licensed motor vehicle dealers, motor vehicle reconditioners, motor vehicle rebuilders and motor vehicle wholesalers must maintain blanket motor vehicle liability insurance coverage for all vehicles, including those held in inventory by the licensee, regardless of the party in possession of the vehicle, whether located at a licensed location of the licensee, or operated on any public street or highway within the State of Alabama. Evidence of such coverage, in the form of an insurance certification form generated through the dealer license website, must accompany the application receipt. The coverage amounts must be no less than the minimum amounts set for bodily injury or death and for destruction of property under Section 32-7-6(c), Code of Ala. 1975. A licensee who fails to maintain blanket liability insurance policy may be assessed a civil penalty of up to five thousand dollars ($5,000).

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If I previously provided an insurance certificate must I submit a new one with this year’s application?

Yes, each application must be accompanied by a completed certificate of insurance generated through the dealer license website. If there is a change in the insurance company, a new certificate of insurance must be delivered to the Motor Vehicle Division before the old policy is cancelled.

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Do I need a Sales Tax Number?

A sales tax number assigned in the same name as the business is required if the licensee sells any motor vehicles to non-dealers. No application for a new or used retail dealer’s license will be accepted without a sales tax number for the business.

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How do I apply or register for a Sales Tax Number?

To apply or register for a sales tax number, you may go to http://revenue.alabama.gov/salestax/register.html. Read the Instructions prior to registering so that you will be prepared with the information required for registering. When you are done, click on the "I Agree" button at the end of the process and you will receive a confirmation number. If there are no problems with the application and you have selected the e-mail option, you should receive your account number within two to three days. A license will be mailed to you later.   If you prefer to apply in person or through the mail, you may complete the Combined Registration/Application/Change Form, (form COM:101). Click here to download the COM:101 form. You may also contact the Business Registration Unit in Montgomery by calling (334) 242-1584 or pick up an application from your local Taxpayer Service Center. Remember to allow time for your Sales Tax Number to arrive before submitting an application for a retail dealer.

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If I sell motor vehicles on the Internet, am I required to obtain a motor vehicle dealer’s license?

Yes, you are required to obtain a motor vehicle dealer’s license if you are publicly selling and soliciting the sale of motor vehicles on-line. You must have a permanent business location. Each permanent location must be owned or leased by the sole proprietor, a partner, LLC member or corporation. If you are a retail dealer, you are required to have a permanent sign that meets the sign requirements (see rule 810-5-12-.01).

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What do I need to do if I move from my licensed location?

Motor vehicle dealers may also electronically update their dealer regulatory license information using the Motor Vehicle Dealer’s Regulatory License Portal. A new insurance certificate must be provided for the new location. Retail dealers must also furnish photographs of the new location and sign.

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Is there a charge for each location?

The primary location is included in the license fee. There is a $5.00 charge per additional location.

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Am I required to remit any additional money when making a change to my regulatory license?

An additional fee is only required when additional locations are added to the license. Also, if the business relocates outside of the county in which the original license is based, the licensee will have to complete a new application.

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If I bring my application to Montgomery in person, what do I need to bring and where do I go?

Transmittal sheets and supporting documents may be delivered to the Motor Vehicle Division 2545 Taylor Road; Montgomery, AL 36117. However, all license applications and payment of fees must first be processed through the dealer license website.

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What are the location and sign requirements?

Motor vehicle dealers (retail, wholesaler, rebuilder or reconditioner) must have a permanent business location. Each permanent location must be owned or leased by the sole proprietor, a partner, LLC member or corporation. If you are a retail dealer, you are required to have a permanent sign that meets the sign requirements (see rule 810-5-12-.01).

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When providing a picture of my sign and location, may I use digital photographs?

Yes. You may use digital photographs. However, they must be clear. (see Rule 810-5-12-.01 for details about sign and photograph requirements.).

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If I want to conduct a tent sale at a different location, what must I do to obtain the proper licenses?

A tent or off-site sale can only occur in the city or county where you are licensed as a used motor vehicle dealer or within your area of responsibility as a new motor vehicle dealer. The fee for an off-site sale is $25. The off-site license must be obtained at least 14 days prior to the beginning of the sale. The offsite license must be obtained through the dealer license website https://dealerlicense.mvtrip.alabama.gov/. Once this license is obtained, the appropriate privilege license (Section 40-12-51, 40-12-61 or 40-12-169) should be obtained from the county probate office, as well as any city licenses required. Effective August 1, 2014, licensed motor vehicle dealers will be able to obtain an off-site license at least one calendar day before conducting each off-site sale.

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Do you still have an unanswered question?

Please email us at dealerlicense@revenue.alabama.gov.