How Many Cars Can You Sell In A Year In Florida?
Although every state allows the sale of personal vehicles, they all have limits on the number of vehicles that a person can sell each year without having to become a licensed car dealer. In Florida, it is legal to sell two cars a year, but if you sell three or more in 12 months, you must obtain a dealer license or you run the risk of fines and other penalties.
Getting a dealer license means attending dealer training classes, establishing a business entity, finding an appropriate office and display space, and securing insurance and a $25,000 surety bond, plus some other requirements. While the process is quite involved, it is legally necessary if you plan to sell three or more vehicles a year and it does offer some tax and other benefits compared to selling privately.
Selling Personal Vehicles
The state allows the resale of one or two personal vehicles a year and to sell a vehicle privately, you may need to follow these steps:
- Obtain a temporary license tag – The license plate remains with the seller of a vehicle in Florida, so if you have already transferred yours to your new vehicle, you will need a demonstration temporary tag. This allows potential buyers to test drive your vehicle.
- Pay off liens – Legally, to sell a car privately in Florida, any existing lien must be paid off. Once the money has been repaid, the lienholder needs to report to the Florida HSMV and have the title of the vehicle transferred. You can sell a car to a dealer if it still has an existing lien.
- Have the VIN inspected – You, as the owner, and an official representative must inspect the VIN number of the vehicle to ensure that it matches official documents.
- Transfer the title – Take the buyer to the local HSMV, ensure that you both have photo identification, and have the title transferred from your name into the name of the buyer. If the car is dated 2011 or newer, it will require an odometer disclosure, too.
- Create a bill of sale – Fill in form HSMV 82050 as an official bill of sale. All vehicle sales must include a bill of sale according to Florida law and it helps ensure that you, as seller, are no longer liable for the vehicle after it is sold.
A vehicle must be registered by a new keeper within 30 days of acquiring it. Selling a vehicle without first registering the title in your name is also illegal, and these offenses can carry financial penalties, as well as possible jail time.
How Much Does It Cost To Get A Dealer’s License In Florida?
If you sell more than two vehicles in a 12-month period, in Florida, you need to get a dealer’s license. A dealer’s license costs $300 and has a renewal fee of $75 per annum. Motor home dealers and other types of specialist vehicle dealers may have to pay extra fees according to the type of vehicle being sold.
What Else Is Required?
- Find an appropriate building – You will need a dealership building before you apply. The building cannot be a residence, must be an office, and must have appropriate office furniture, which typically means a desk, two chairs, and a phone.
- $25,000 surety bond – A surety bond protects potential buyers from fraudulent activity. If you act dishonestly, a wronged buyer can sue against the value of the bond, ensuring that they are not left out of pocket.
- Garage insurance – You must have garage insurance that includes appropriate single limit cover and protection against property damage and personal injury.
- Attend a dealer seminar – You must also attend a two-day training seminar that teaches you about dealer laws, dealer compliance, and other legal requirements. The training course ensures that you will follow state and federal requirements with the sale and acquisition of all vehicles.
Dealer’s License Benefits
As well as ensuring that you comply with Florida state laws, getting a dealer’s license means that you will be able to access and buy from dealer-only auctions. You can also purchase at wholesale prices and with auction financing options, which tend to be more favorable than loans. You won’t have to pay sales tax or registration fees when buying vehicles either.
How Do You Get A Dealer’s License In Florida Without A Lot?
You cannot get a dealer’s license in Florida without having a lot to display vehicles. This is a requirement for the license application and cannot be circumnavigated.
How Much Does It Cost To Get An Auction License In Florida?
A Florida car auction license allows you to sell vehicles at auction. It has many of the same requirements as a dealer’s license, including the requirement to have a display lot and to put up a surety bond. Like a dealer’s license, it costs $300 for the initial application and has a renewal fee of $75 per annum thereafter.
Without getting a dealer’s license, it is legal to sell two personal vehicles a year. If you sell three or more in a 12-month period, however, you will need to apply for and receive a dealer’s license. This costs $300 and it requires that you have a registered business, a suitable office, and a display area for your vehicles. Getting a license will grant you access to wholesale auctions and reduce your tax liability when buying cars and is a legal requirement.
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Featured Image Credit: Jeremy, Wikimedia Commons CC BY 2.0