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Utah Motor Vehicle Dealer Bond

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Getting a Utah motor vehicle dealer bond is a key step to becoming a licensed car dealer in the state. The motor vehicle dealer bond serves as an extra guarantee that your dealership will follow all rules and regulations that govern motor vehicle dealers in the state of Utah.

  • Surety Bond Name: Utah Motor Vehicle Dealer Bond

  • Surety Bond Amount: $75,000

  • Surety Bond Term: 1 Year

  • Obligee: Utah State Tax Commission

Just like all surety bonds, the Utah motor vehicle dealer bond serves as protection for the general public, and not as insurance for your business. In case you don't follow the rules and your obligations under the bond, a claim can be made against you. If proven to be a legitimate claim, the penal sum of the bond is used to compensate the affected parties. The surety covers the costs of claims up front, which you’ll be required to reimburse in full. This means you should avoided having any claims, as they can cause serious harm to your business and finances.

Utah State Tax Commission Seal

Utah Motor Vehicle / Auto Dealer Bond Cost

While $75,000 might seem like a large amount to pay, in reality, you only need to pay a percentage of it to get bonded, which is called the bond annual premium. The surety company will look at several factors to determine your motor vehicle dealer bond cost, most importantly, your credit score. Factors such as years licensed and years of industry experience will also play a factor in your dealer bond cost.

  • If your credit score is above 650, you’ll likely have to pay between .75% and 2% of the bond amount.

  • For applicants with credit scores between 600 and 649, the rates range between 2.5% and 4%.

Utah Motor Vehicle / Auto Dealer License and Renewal


Who is required to be licensed?

The surety bond requirement applies to all new or used motor vehicle or large trailer dealers and all motorcycle or small trailer dealers that are doing business in the state of Utah.

What are the bonding requirements?

  • Dealers must file a corporate surety dealer bond with MVED.

  • Motorcycle or small trailer dealers — $10,000

  • New or used motor vehicle or large trailer dealers — $75,000

  • Small trailers are trailers between 750-1,999 lbs. unladen weight.

What are the insurance recommendations?

It is required that all motor vehicle dealers in the state of Utah obtain liability insurance coverage. Some examples include:

  • Garage Liability Policy with a minimum of $80,000 Premises and Auto Liability Coverage

  • Dealer Inventory Physical Damage Coverage

  • Uninsured and Underinsured Motorist Coverage

  • Garage Keepers Coverage - (if you do repairs, or paint & body work)

  • Property Coverage for any buildings or tools

  • Medical Payments of $1,000, $2,000, or $5,000

How to become a motor vehicle dealer?

Principle Place of Business

You must have a site or location in Utah that complies with all local ordinances, including zoning for motor vehicle sales and is devoted exclusively to the sale of motor vehicles and business incidental to it. The site must be sufficiently bounded by fence, chain, posts or other wise marked to definitely indicate its boundaries. There must be enough display space for at least three vehicles. There must be a permanent, enclosed building or structure large enough to accommodate the office of the dealership. This office must provide a safe place to keep the books and other records of the business. You must conduct the principle portion of the dealership’s business from this location and you must also keep the dealership’s books and records there. The Principle Place of Business must not share any common area with another dealer, auction, dismantler, of manufacturer or any business or activity not directly related to motor vehicle commerce.


A permanent sign, not less that 24 square feet in size must be either painted on the dealership office, attached to the office with nails or bolts, or placed on posts in the display yard that have been securely anchored in the ground. The sign must fully identify the dealer’s principle place of business and show the full name of the dealership as it is licensed. A picture of the principle place of business and sign should be submitted to MVED along with the application, forms and fees.


License fees are as follows:

  • New or used motor vehicle dealer – $127

  • Special equipment dealer – $127

  • New or used motorcycle/OHV/small trailer dealer – $51

  • Dealer plates (optional – $ 12.00 each, limit of 5, plus a small handling fee)

  • Fingerprints – $ 20.00 each owner, partner or corporate officer

Application Form

Form TC-301, Bonded Motor Vehicle Business Application, must be properly completed and signed. Applications, bond, picture of the sign and principle place of business, and fees must be submitted for approval to the Motor Vehicle Enforcement Division, 210 North 1950 West, Salt Lake City, Utah 84134. Please allow five to ten working days after the application is received by MVED for on-site inspection of the place of business. The license cannot be issued until after this inspection.


Include passport quality photographs of owners, partners, or corporate officers. As explained above, it is also required that photo of the sign and place of business be included.


All individuals included as an owner of a dealership ( Owner can be a Proprietor, LLC and LLP Member, Partner or Corporate Officer) must submit a standard fingerprint card filled and verified by a local law enforcement agency and a fee of $20.00 with the application and forms. Each owner must fill out a Form TC-465, Fingerprint Waiver.


All applicants for a dealer license must attend an eight-hour orientation course. In order to renew a dealer license, the dealership must complete a three-hour training class each year. See Dealer Training for organizations that offer online or in-person training.

Sales Tax License

Dealers must furnish proof that they have a valid sales tax license for the sale of motor vehicles. MVED can assist you in obtaining forms and filing for the Sales Tax License. TC-69, Utah State Business and Tax Registration is needed to apply.

Franchised Dealers

All applicants seeking a new license are required to submit a letter from the Manufacturer authorizing you to sell a specific make or model.

Business Name

All applicants will need to file their trade name with the Department of Commerce, 160 East 300 South, Salt Lake City, Utah – Telephone 801-530-4849.

Licensees who finance their sales or who arrange financing for their purchaser must be registered with the Department of Financial Institutions, 324 South State, Suite 201, Salt Lake City, Utah – Telephone 801-538-8830.

Dealers who sell mobile homes should contact the Department of Commerce, 160 East 300 South, Salt Lake City, Utah – Telephone 801-530-6747.

Dealer Plates

Dealer plates may be used for transporting unlicensed vehicles that are owned by or consigned to a dealer, on public highways. In order to obtain plates, the plate section on form TC-301, Bonded Motor Vehicle Business Application, must be completed. You must also provide proof of declaration page(s) for plate insurance.

There is an initial limit of 5 plates. For every 25 vehicles sold, the dealer can apply for one additional dealer plate.

Lost or stolen plates should be reported immediately with a written notice that must be mailed or faxed to MVED. The dealership’s local police department or sherrif’s office should also be notified. If the plate was stolen, please also list your local police agency’s case number in your written notification (UCA 41-3-507). A lost or stolen plate can only be replaced after it has expired on June 30th (Tax Commission Rule R877-23V-16).

Hassle Free Guarantee Dealer Bond

Whether applying for your first auto dealer license in Utah, or renewing an existing one, you have to submit a dealer application form, together with all necessary documents that prove you meet the requirements.

When you renew your license, you’ll have to renew your Utah auto dealer bond as well. As your business finances and personal credit score can change, make sure you work on improving those stats, so that you can reduce your surety bond cost over the years.

Request a FREE Bond or Insurance Quote today!


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