Opening a dealership in Illinois starts with a dealer license from the Secretary of State. The steps below cover the license types, the course, the bond, insurance and every document you will send.
At a glance
| Issued by | Illinois Secretary of State, Vehicle Services Department |
|---|---|
| Surety bond | $50,000 |
| Course | 8 hours, from the Secretary of State's office |
| Annual fee | $1,000 certificate of authority ($500 for a first application filed June 15 to December 31) |
8 steps to your license
1. Choose the license type
- Franchise dealer: new cars
- New and used: new and used motor vehicles
- Used only: used cars
- Motorcycle dealer: motorcycles only
2. Meet the prerequisites
- Be at least 18 years old
- Hold a valid Illinois driver's license
- Have a permanent physical place of business
- Get a sales tax permit from the Illinois Department of Revenue
- Register the business with the Illinois Secretary of State
3. Set up the business location
The premises need an office, a display area, the right zoning and room to store and keep vehicles. A residence does not qualify.
4. Take the pre-licensing course
The eight-hour course comes from the Secretary of State's office and is required of every new dealer.
5. Get a surety bond
The bond is $50,000, made out in the business name and the Secretary of State's name.
6. Get liability insurance
Minimums: $100,000 for bodily injury, $300,000 per accident and $50,000 for property damage. The policy must not expire before December 31.
7. Send the application and fees
The package includes the application form, proof of the course, the lease or deed (the lease cannot end before the license term), the zoning form, proof of insurance, the sales tax permit, the bond, the background check receipt from a state-approved vendor, the manufacturer's franchise agreement for new vehicle dealers, and the Illinois EPA hazardous waste number if there is a repair shop. The fees:
- Certificate of authority: $1,000 a year ($500 for a first application between June 15 and December 31)
- Master plates: $45 a year
- Duplicate plates: $13
Mail it to Secretary of State, Vehicle Services Department, Dealer Licensing Section, 501 S. Second St., Rm. 069, Springfield, IL 62756.
8. Pass background checks and the inspection
You and key staff go through a criminal background check, and the Secretary of State's office inspects the location.
Before you apply
Requirements, fees and bond amounts change. Confirm the current rules with the Illinois Secretary of State before you file. This guide is general information, not legal advice; for questions about your situation, talk to a lawyer.
Licensed? Stock your lot at the Kendall FL Auto auction
Licensed dealers can register to bid at the Kendall FL Auto auction, check the run list of upcoming lots, or consign vehicles to the sale.